Teach Children to Save
How old do children need to be before they’re able to start understanding the concept of money and saving? According to the American Bankers Association, they’re old enough when they begin asking for items they need or want. On April 28th, the ABA is celebrating 25 years of Teach Children To Save and below are a few tips to start talking about with your children.
At the bank
- When you go to the bank, show your children how you make a deposit and talk to them about what happens once the money is deposited into 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 your pay is budgeted and what is deducted on a monthly basis to pay for basic needs, such as housing, food and clothing. Also, let them know how a portion of your pay gets put into a savings account to pay for unforeseen expenses or college or retirement.
At the market
- 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. Talk to them about how the money gets removed from your account and emphasize how important it is to pay bills on time to avoid penalties.
Credit Cards, Debit Cards and ATMs
- Explain the difference between using a credit card versus a debit card. Make sure they understand that credit cards are a loan and need to be repaid and a debit card removes money directly from your account. You can also discuss how you can remove or deposit money out of your account using an ATM card.
Here are interactive links from the ABA for Teach Children to Save Day.
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