Teach Your Children To Save While You Still Can
Despite what most children may think, money does not grow on trees. According to The Cheat Sheet, if you make an effort to teach your child about saving money, they are much more likely to value it as they get older. You can help reverse the thinking that you have an unlimited supply of money by teaching kids the value of a dollar, and where money actually comes from.
One of the best ways to help your child start saving is to open a kids savings account. Launch CU can help provide your child with a Youth Savings Account. At Launch CU all children under the age of 18 are eligible for a child’s savings account, and are even able to earn dividends, regardless of the balance in their account! In addition, children between the ages of 16 and 17 are able to open a checking account with a joint adult owner. Our classic checking accounts have no monthly fee and no minimum balance requirement. For more information on Launch CU youth checking accounts, click here.
How Do I Help My Child Learn The Value Of A Dollar?
So now that you have your child set up with a youth savings account at Launch CU, you may want some helpful hints on how to help them build their savings and learn the true value of the Washington. Here’s our guide to child savings success.
- Make Your Child Work For His Or Her Money. It’s essential to have your children work for their money. It will teach them that in the real world, they will have to work in order to be paid. Once your child gets a little older, think about switching over to an allowance. Provide your child 50 cents to $1 per week for how old he or she is. So for example, if your child is five, provide an allowance of $5 per week. This will help your child to learn the value of a dollar much quicker if they actually have to work for the money that they are given.
- Give Your Child Control. Provide your child with control over his or her money, but have them put a certain amount of each week’s earnings into their youth savings account. You will notice that your child will probably work towards purchase goals when given control of his or her own money. Providing your child with control of his or her spending, as well as the ability to track spending will help to build healthy financial habits, as they will soon learn the difference between want and need.
- Teach Your Child To Respect Property. If your child grows up respecting his or her own property as well as the property of others, it is likely that he or she will be careful with money later in life. According to The Cheat Sheet, another good way to help your child save in the future is to abide by the old “you break it, you buy it” saying. If your child breaks a household item, have them pay for a small fraction of the item in order to show the cost of replacing broken items.
- Take Your Child To The Credit Union. Take your child to the credit union with you so that he or she can learn different processes associated with banking. This will help to make the experience real for your child.
- Set A Great Example. Many children learn by example, so it’s important to provide your child with great examples of saving. Think about having your own savings jar for extra activities, or demonstrate additional control at the store by only buying the essentials.
- Opportunity Cost Lessons: Think about showing your child identical items at the supermarket with different prices, and explain to them which is a better bargain. Teach your child that not spending as much on one item means you have more money for other things. Teaching children how to find savings and sales at a young age is important to ensuring that they make smart purchases in the future.
- Match your child’s contributions. Think about providing your child with a savings match to encourage additional savings. This helps your child to get an early understanding of a company 401(k). Match the amount of money that your child deposits into his or her youth savings account, and watch the balance grow!
- Play Games & Have Fun. According to U.S. News, playing games like Monopoly and The Game of Life can teach your child how to spend and earn money. Online games such as Save! can teach your child to separate wants from needs.
- Read Launch CU Newsletters. Launch CU provides quarterly newsletters for children and adolescents that provide financial information in an entertaining way. In addition, there are special contests and promotions that your child can participate in to encourage savings and learn about finances. To view Launch CU newsletters, click here.
Saving isn’t easy for everyone, but learning how to save at a young age will help to make saving easier in the future. Though you can sometimes teach an old dog new tricks, it is much easier to teach a puppy these same tricks. Creating healthy spending habits now can help your child to be financially stable later in life. Take the first step to your child’s future by opening a kids’ savings account at Launch CU, and help your child to go beyond to reach his or her future financial goals.