Sunday, April 13, 2014

8 Magic Words to Say that Makes Saving Attractive to Kids

(This is a guest post by Tina Beltran, a blogger and writer of moneymax.ph)

“Money doesn’t grow on trees,”parents always say. It’s the sort of thing that echoes in your head every time you’re about to spend our money on something you’re fairly certain your ma will not approve of. Now that you’re the adult, it’s your responsibility to educate your little ones on the value of saving. Not quite sure how? Here are some “magic words” you can use to help them better understand how and why they need to save:
  1. The sooner you save, the more your money grows.
You know how easy it becomes to postpone saving for another day. As soon as they start receiving an allowance, instill in your children a sense of urgency; show them that they better start saving now. Monitor them closely at the start, until saving becomes a habit for them. For example, at the end of each day, have them account for how much in total they spent and saved, and show them where to put their savings (such as in a piggy bank).
  1. Wait before you buy.

Impulse buying is the greatest enemy of saving. While our urges are something that are difficult to tackle head on, teach your kids to use another approach: to wait at a much later time—say, a day or a week—if they face the temptation to buy something that isn’t a necessity or not listed on the budget. Hopefully, they’ll wake up to their senses and stay on track toward their saving goals.
  1. Paying on credit is spending money you don’t have.

Credit cards are extremely useful and convenient, but misuse could result to grave financial consequences. The earlier you teach your children about debt and interest, the more responsible they would be in handling their finances as grown-ups.
  1. Save first, spend afterwards.

In teaching children how to budget their allowance, show them how it’s easier to save if they set aside part of their money for saving first, before they spend the rest on their needs. Motivate them to spend by helping them plan for a major purchase such as a new phone or a new toy. Being able to buy something they want from their own savings would make them see that saving has its rewards.
  1. Save for the rainy days.

Ideally, we don’t want our kids to experience poverty or deprivation. However, it’s one of the realities of life. Even if they’re raised in comfort, unexpected things happen and they need to be prepared, both emotionally and financially. Remind them everyday why they shouldn’t stop saving: so they have a safety net for whatever emergencies arise in the future.
  1. Money is only a tool.

Telling this to your kids will build in them a better mindset about money. They shouldn’t see it as something that give them happiness, but rather as a tool that they can use to reach goals and achieve their dreams. Emphasize that they should control money; not the other way around.
  1. Every cent you save and spend adds up.

Every penny saved is a penny earned, Benjamin Franklin once said. Children should be made aware that any amount they choose to either spend or save adds up to a meaningful sum in the long run.
  1. Money doesn’t grow on trees.

Of course you shouldn’t miss this one: because there’s truth to it. Our parents knew it. Our grandparents knew it. Kids should learn the value of hard work and be taught to make sure that any amount of money they spend must go to something that adds value to their lives, and not just on a passing whim.

Money may not grow on tree, but it can with investment. Now, as that concept is still too complex for the average kid, you can, in the meantime, encourage them to open a savings account of their own, where they can grow their money bit by bit. Teach them how to avail of a kiddie savings account and watch them grow up to be financially responsible and money savvy individuals. It’s a form of investment as well and not a bad way for them to get started.

8 comments:

Sharon D said...

Great post, Rose. I think many adults need to be reminded of this too..lol ^.^

suituapui said...

Yes! Great advice. Parents who spend...spend...spend...on their kids are in danger of bringing up children who do not know the value of money. Must say no as and when necessary.

mun said...

good advice but must also balance it by giving the other side of the story too. I know some children who have hang ups about money and being a young miser because of the parents placing too much emphasis on saving money.

ChrisAu said...

Great post ! Even I myself got to be reminded of these principles ! Too often, we falls into the temptation of buying things especially gadgets as well as expensive meals, where sometimes due to stress.

Ez Vina said...

Great, i practice 1 n 2 only.

Princess Ribbon said...

Agree with the post.. Now am slowly practicing it with Kz.. He likes to demand for toys and junk food, sometimes we give in, sometimes no.. Good sharing here..

Small Kucing said...

good idea to teach the kids this

Azura Chan said...

Well said and great advice. I have provide a piggy bank for my daughter. Teach her how to save money.