There has never been a more important time to teach your kids about the art of savings
When it comes to teaching children about money – they can never be too young; you obviously need to make it age related but all children should be told that there is a constant balance between working hard and having money to spend.
Children very quickly catch on to the concept of money being exchanged for goods – they no doubt have been shopping with you since they were tiny tots strapped to the grocery trolly. So don’t underestimate the messages that they are taking in.
Toddlers often say things like – my mummy gets money from a machine ( meaning the ATM) or the shop keeper always gives mummy money ( the change!) or daddy asks the bank man and he just hands it over to him.
Or as one mother recently mentioned ; My three year old thinks that he can just grab at anything and it will be taken to the check out – I suppose that is what he has always seen me doing in the supermarket and elsewhere.
““Give them little paid jobs to do and in return let them pay the pocket money into their savings account, a bit like popping it into their piggy bank, but it allows them to watch their money grow and see what interest they get. It's a great way”
So the answer is talk to your kids and explain that money does not grow on trees, that mummy and daddy need to work hard to earn money so it needs to be looked after and spent thoughtfully.
Build a relationship between working hard and being rewarded with money – even at home ensure your children realize that they need to ‘work’ for their pocket money – whether that be helping around the house or trying hard at school.
Children now adays seem to want instant gratification - if they want something they need it now. It’s an important lesson to teach children to have patience, to save for the toy or clothing they want and to use their own money to buy items; they will soon learn the value of money when they have to spend their own. Their choices and desires will become better thought through and prioritised.
As children get older their pocket money could be directed into their own bank account. Suggest an amount that they will receive (against good behaviour or help) and make them budget for their own personal items.
One lovely idea to help teach children the importance of money for oneself but also to help those in need is this;
Why not have three jars or boxes labelled SHARE SAVE SPEND
When children receive their pocket money or birthday money make it a rule in your household to split the money into these three jars/boxes; put some of the money into the SHARE with others jar, some money into the SAVE for a raining day jar and then the rest into the SPEND when I need to jar.
This is a very good lesson for life and if encouraged early enough will give your kids a very positive advantage later in life.
Remember there's never been a more important time to teach your kids about the art of saving, and so MoneySupermarket is launching a challenge with a difference – a kids' saving challenge aimed at encouraging the next generation of savvy savers. Take a look by clicking here.
You could also win £1000 so take a look now