Children learn very early that money can buy candy and toys. In school they are taught basic mathematics concerning money so they already know the basics. Here are 6 tips to help them want to start saving and investing.
1. 3 things to do with money. They can let it sit in their wallets and purses, spend it, or save it and watch it multiply. Drive to different parts of your city with your children and point out different living conditions. Some spend everything and never get ahead. Others let their money sit idle and it never increases. But the wealthy know how to spend what they need and then save and invest the rest.
2. Help your children set goals. Ask your children what they want when they grow up? Every child wants to be someone like a doctor or a fireman but what do they want? How do they want to live? Do they want to be poor or rich? Help them set some goals early and explain that proper saving and investing is a huge part of getting what they want.
3. Activate those goals. If you have a financial planner you can introduce your children. Explain to your adviser what you are doing and they will have the foresight to develop a future client. You can also help your children develop a financial plan. Make a game of it and show them how they can retire by the time they are 40…wouldn’t that be fun.
4. Be thrifty. People grow rich slowly and being thrifty is a large part of this. Teach your children the difference in price and value and how to shop well. This in turn leads to more money available for saving and investing.
5. Open savings accounts early. Take your children to the bank as soon as they understand basic money principles. Open savings accounts in their names and go over the statements with them as they come.
6. Give your children choices. A big birthday party, for example, is expensive. What if your children would be just as happy with cake, ice cream and some games with their friends? Say something like, “A big party like we had last year cost $200.00. What if I put $185.00 in your savings account and just spent $15.00 this year?” Some of your children will still want the big party but you might be surprised to learn that some will be listening to you and will choose the savings option.
Teaching children to save money should be fun. Let them know this is for their future because you love them. You will enjoy this time together.
