Teaching kids to save money is easy with some simple steps. Start them early and you’ll be sure to reinforce life long habits. 

Growing up,  my parents always taught my brother and I to save our money.  Saving money started first with collecting extra change and putting it in huge jar with our names on it.  It was a family tradition.  We would count all of our change and place friendly bets on who had saved the most.  Afterwards, we would take our rolled up coins to the bank to exchange the coins for dollars.  The first time I came home with a $100.00 bill I was certain I was the richest girl on the planet! It was hard to break that large bill but also hard not to spend the money on something fun. I realized as a young child that saving money was important. 

When I got older, I started earning a small allowance.  Even back then, I couldn’t really buy much with the $2.00-$3.00 I earned per week.  So I saved up for something “big.”  A doll? A book? A new toy? The more money I saved, the better choices I had.  

Around the age of 13 or so, I took several babysitting classes and became a “certified babysitter.”  As soon as my classes were done, I started my own Baby-Sitter’s Club with yours truly as the president, only member, and secretary.  I handmade my own fliers and dropped them off to all the homes with kids within a two block radius of my house.  A year or so later, my babysitting calendar was booked weeks in advance and I was making as much as $200.00 per week during summer breaks. I had a booming business at the age of 14!  My mom took me to the bank and set up a savings account for me.  At the end of each week, we went together to the bank and deposited most of the money into the account; I kept maybe $20.00 or so to splurge on something fun. 

It was a great feeling to earn money and even better when I saw the value of my hard work double and then later triple. Since I knew the money I spent was something I earned, I hesitated to spend it on just anything.   Even when I saw my friends spend all their birthday money on one shopping trip, I knew this wasn’t something I wanted to do.  There were homecoming celebrations coming up, college applications were right around the corner, and cheerleading camp.  My parents expected me to pitch in on some of these extra expenses so I saved. 

As a college student and adult,  the money saving skills my parents taught me continued to serve me well.   Now that I’m a parent, I have passed on the same skills to my children.

 

5 Tips for Teaching Kids to Save Money

Here is what I do to help reinforce the importance of saving money and appreciate the value of dollar. You can start teaching your kids to save money as early as age five.   

1. Start a change jar for each child and convert the change to money once a year.  Show your kids how pennies and quarters add up to real dollars!
2. Agree to match your child’s savings for that new game, pair of shoes, or doll they want.  If they save half, you’ll promise to pay the other half.  Great for big ticket items.
3. Open a savings account in your child’s name and go together to make deposits.  Your child can watch the money grow and see the results of their savings.
4. Show them how to budget and manage expenses. For older children, include your child in other financial aspects such as paying bills and budgeting monthly expenses. With teens, you can even go a step further by allowing them to help you do a free efile with TurboTax. After all, taxes will inevitably become a yearly obligation once they reach adulthood.
5. Let your children pay for their items, big or small, at the checkout counter.  Not only does it reinforce understanding the value of money but also helps with counting and addition skills too.  Your child will be thrilled to get their own bag, receipt, and to pay for it all, just like a grown up!

What do you do to teach your child the importance of saving and valuing money?  Share your tips in comments!