Teach children to save

Teaching children to save and spend wisely usually involves some trial and error. Essentially, what is important is that they develop good saving habits. Parents should always lead by example because if children see a lack of financial stability in the home they will not have a stable foundation on which to learn. Always remember that children live what they learn.


Starting school usually marks the beginning of the journey towards becoming financially responsible. As soon as children are able to count money and can easily differentiate notes and coins, they are ready to handle their own money. Distribute money on a weekly basis and increase this periodically as children grow older. Set a specific time when the money is distributed and stick to it. Being late could imply that it is acceptable to be a little tardy. If they should finish the money before the designated time, tell them that you will give them a loan and will subtract the loan amount from their lunch money over a period. When lengthening the time period in which funds are distributed, this should be communicated in advance and should be based on their ability to exercise discipline in their spending habits.

Ensure that the money given is sufficient to accommodate savings; this will also give children the opportunity to develop the need to save. Encourage them to join savings clubs if offered at school and when the funds are paid out at the end of the calendar year, give them a little treat and have them save the balance in a bank.


Children should save towards specific goals and let them start with small easily achievable ones. Also, you can create an incentive for them to save more by letting them know that you will match the amount they save and you must follow through on this. For smaller children, give them a jar with a narrow mouth in which to put their savings and place it in an easily visible area. If there is a need to borrow from children at any time, please pay them back and preferably with interest. Do not tell them that the money was originally yours; this does not encourage good saving habits.


Teach them budgeting by helping them to note their daily, week and monthly expenditure. Involve them in comparison shopping and explain how you run your household budget. Children tend to be fascinated by details and will take up the challenge in searching the supermarket for the best price. To illustrate the point, you could explain the differences between the more expensive and cheaper items.


Family finances should be among the topics you discuss with your children since they may not realise how much thought, time and effort is put into planning the family budget. If you have not been doing this then now is a good time to start. Without going into too much detail about your income, explain your budgeting process, emphasising the differences between necessities and wants, choices and trade-offs.

The goal of consistent saving is to achieve financial stability. Children will not have lump sums to get there immediately and sometimes it is not easy to convince them to save when there are so many opportunities for immediate satisfaction. To help children form good saving habits that may prevent them from being heavily indebted when they become older is to teach them how to practice delaying gratification.

Saving is a habit and once you get into the habit it is very difficult to beat the thrill from seeing your money grow. Take children along to the bank with you and ask which products and services would be best suited to both your needs as the bank is usually the best source of information about accounts and rates. Open an account for them; they will enjoy economic prosperity in their later years.





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