7 Money-Saving Lessons to Teach Your Kids Today

Given some circumstances, saving money has been a great challenge for people all over the world. Other times, even adults are proven to not have been able to master the art of saving money. 

Nonetheless, it's a good idea to go over some money-related lessons that can help your children learn such skills, especially for preparing for emergencies. It will only do them good in the long run!

Read on to discover these seven money-saving lessons you can teach your kids today.

Lesson #1: Needs Are Different from Wants

Begin teaching children to save by assisting them in distinguishing between wants and needs. Mention basic necessities such as food, shelter, clothing, health care, and education. Wants are extra purchases like movie tickets, candy, or the newest smartphone. Using your own budget, you can demonstrate how wants must give way to needs in terms of spending. 

Lesson #2: You Have to Work for It

According to an AICPA survey, two-thirds of parents gave their children an allowance in 2019, with children earning an average of $30 per week for five hours of chores. 

Allowing your children to earn and save money teaches them financial management skills. When you pay them for chores, they learn the value of their work. 

Lesson #3: Stick With Weekly or Monthly Goals

Saving without explanation may seem pointless to a child. It may be more motivating to assist children in setting a savings goal. If they have a specific goal in mind, help them break it down. Assist them in calculating how long it will take them to save up for a $50 video game if they receive a $10 weekly allowance. 

Lesson #4: Create a Safe Zone 

When your children have a specific goal in mind, they will need a safe place to save money. While a piggy bank may suffice for younger children, an account at a bank may be necessary for older children. As a result, they can monitor their savings progress and see how close they are to reaching their goal. 

Lesson #5: Be Responsible for Your Spending Habits

Understanding where your money goes is essential for increasing your savings. If your children are given an allowance, having them keep track of their daily purchases and add them up at the end of the week can be instructive. Encourage them to think about how changing their spending habits could help them save more money faster. 

Lesson #6: It’s Okay to Make Mistakes 

Allowing children to make mistakes is an essential component of financial independence. While it may be tempting to insist that children avoid costly mistakes, it may be more beneficial to use them as teaching opportunities. As a result, they will spend less money in the future. 

Lesson #7: Encourage “Money Talk”

According to a T. Rowe Price 2020 survey, 40% of parents never discuss investing with their children, and 32% never discuss retirement savings. As such, please take note that money and savings must be an ongoing topic of discussion with children. The key is to keep the conversation going, whether it's a weekly check-in or daily money chats. 

Conclusion

More than being able to talk to your children about money, it’s better to simply be a good example. While teaching them such lessons is highly beneficial, encourage them to put everything into practice as well. This way, you can journey together towards shaping healthy relationships with money, financing, and budgeting.

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