7 Tips to Teach Your Kids the Importance of Savings

If you’re like most parents, your child’s allowance has come up at some point or another. But what if it weren’t just about the money? What if you could use it as an opportunity to teach them important financial lessons, which will help them when they grow up and start making their own money?

Here are five easy ways to teach your kids the importance of savings, so that when they are old enough to manage their own finances, they will be financially ready.

1) Make it fun

One way to get your kids excited about saving money is to make it into a game. Sit down with them and help them set up a savings goal for something they really want. Every time they put money into their savings, they get closer to their goal. You can even match their savings to help them reach their goal faster.

For every dollar they save, you can contribute a dollar. This will help them see the importance of saving and how their savings can grow over time.

2) Make savings a part of their everyday routine

If you want your kids to develop healthy savings habits, you need to make saving a normal part of their day-to-day lives. That means setting up an automatic transfer from their checking account into a savings account each month. This way, they won’t even be aware that they’re saving as they go about their daily business.

Make sure they learn how much money they have available in their checking and savings accounts on a regular basis so that they get used to not spending everything.

3) Write down what you save

One of the best ways to encourage your kids to save is by helping them track their progress. Have them write down every time they put money into their savings, no matter how small the amount may be. This will help them see how their savings are growing and make them feel proud of their accomplishments.

4) Have your kids manage their own money

One of the best ways to teach your kids about money is to have them manage their own. Allow them to make mistakes and learn from them. As they get older, give them more responsibility and decision-making power when it comes to their money.

5) Get your kids involved in small household chores for allowance

While it may be tempting to just hand your kids an allowance and let them do with it as they please, that won’t teach them the value of money or how to save.

Instead, get your kids involved in budgeting and help them set savings goals. You can also have them earn their own money by doing chores around the house.

Explain to them why it’s important to save and offer incentives for reaching their goals. As they get older, you can involve them in more complex financial conversations and decisions. By teaching your kids the importance of savings early on, you’ll set them up for success later in life.

6) Set an example for them

The best way to teach your kids about savings is by setting an example yourself. Show them how you save money each month and explain why it’s important. You can also open a savings account for them and help them make regular deposits.

7) Teach your kids about delayed gratification

Help your kids set financial goals and encourage them to save up for things they want. This will teach them the value of delayed gratification and help them understand that money doesn’t grow on trees.

Also, explain to your kids that sometimes it’s important to wait to spend their money. Help them understand that if they wait, they may be able to get something better or more expensive later on.

Safeguard your child’s financial future – let’s talk about investments

Secure your child’s financial future by maximizing your investments today. Short and long-term financial planning depending on your liabilities and financial goals – talk to our financial advisors today to know more about RRSP and RESP savings plans!