Welcome back to part two of our teaching kids to save money series! Last week, we kicked it off by talking about one method to teach kids to save money by using a piggy bank system. Today, we’re going to talk about setting money saving goals and when to start. This ties in with teaching your child how to budget, so you might want to take a peek at that post as well.
It begins when they’re very young. You’re at the store and your child begins to ask for things. They ask for candy. They ask for toys. They ask for stuffed animals and bright balloons. These sometimes challenging situations are also opportunities. They’re opportunities to teach children that you can’t always get what you want. There are so many teachable moments when it comes to money.
They also present an opportunity to help your child learn the benefit of saving.
Choose a toy; set a goal.
Let’s say that your young child is at the toy store with you and they decide they want a stuffed animal. They can’t live without it and must have it now. Instead of buying the item for them or saying no, why not turn it into a learning moment. Talk to your child. Take a look at the price tag together. Is it something that they can reasonably save for? If so, take a photo of the animal. Tell your child you’re going to teach them a new game.
Go home and count the money in their piggy bank, if they have one. If they don’t then you can grab a mason jar or a shoe box and label it for savings. Print out a picture of the toy they want and tape it to the savings receptacle.
They now have a savings goal.
You can show them how long it’s going to take them to save for the toy if they set aside their money.
If your child gets an allowance then that can get added to the savings goal. You can also give them extra ways to earn money for the toy. Depending on the price of the toy you may make a deal that if they save for half, you’ll pay the other half. This can help a child learn the power of saving without feeling defeated because the goal is too large for them.
Here’s the key: Don’t buy the toy for them.
They will either stick to it and save enough or they won’t. Either way, it’s a valuable lesson. Whenever possible, try to guide your child toward a savings goal that is reasonable and attainable. Check in every couple of days to see how they’re doing. This will help them stay focused and motivated.
Learning to save is a valuable lesson and you can begin teaching your child when they’re very young, even before preschool for the very motivated child.
Money is also a great way for children to apply basic math skills, important life skills, and critical thinking skills.