Teach Children the Importance of Saving

How old do children need to be before they’re able to start understanding the concept of money and saving? The American Bankers Association says kids are old enough to learn about saving when they start asking for things they need or want. Below are a few tips to start discussing with your children.

At the bank - When you go to the bank, show your children how to make a deposit. Explain to them what happens after the money is in your account. You could even ask branch staff to explain how the bank operates and ask for a short tour.

On payday - Write on a piece of paper how you budget your pay and what you spend each month on things like rent or a mortgage, groceries, utility bills and clothes. Tell them that some of your money from work goes into a savings account for emergencies, education, or retirement.

At the grocery store - When you go to the store, explain how shopping with coupons or comparison shopping can save money. This is a great time to explain needs versus wants with your children. 

Chores and allowances - Assigning your children chores in order to earn money is a great way for them to understand savings. Discuss ways for them to budget, spend or save for something they want and figure how long it will take them to purchase.

Paying bills - Explain what bills are and the various ways to pay them each month: over the phone, by check, electronic check or online check draft. Explain how money is taken from your account and stress the importance of paying bills on time to avoid fees. 

Credit cards, debit cards and ATMs - Explain the difference between using a credit card versus a debit card. Explain that credit cards are like a loan that must be paid back, while debit cards take money from your account right away. You can also discuss how you can remove or deposit money out of your account using an ATM card. 

Set your kids up for financial success by teaching them the importance of money and saving at an early age. Capitol Federal® has a Blue Bucks Kids' Saving account that would be perfect for your little ones.

Here are interactive links from the ABA for Teach Children to Save Day: