The ABA Community Engagement Foundation sponsors Teach Children to Save (TCTS), a national program that organizes banker volunteers to help educate youth on saving habits early in life. Teach Children to Save Day is celebrated annually on April 24 in hopes that parents will begin teaching their children the necessary skills for smart money habits.
Join us as Community Bank share’s some thoughts on teaching your child to save and provides some recommended books by the American Bankers Association through their Book Award Program!
Tip: Children learn and comprehend differently at the various stages in their life. Take into account the age of your child, to find what works best to help your child learn to save.
During these years your child is curious about everything and is also more easily manipulated, take advantage of this to teach your child to learn to save and spend money. At these young ages children learn better with visuals and interactive learning. Have your child draw pictures of things they want to buy and place their drawings on the different envelopes. Each time they receive or earn money let them choose which envelope to put it in. While doing this, make sure to explain how much each one cost so they know what they must save to reach that prize.
Recommended books: The Bernstein Bears –Dollars and Sense, Tia Isa Wants a Car Sam and the Lucky Money, Lemonade in Winter and Jackson Jones and the Puddles of Thorns
In these fun tween years, children are starting to realize opportunity cost. How long it takes to buy one thing over another and how to make smart decisions. A great idea would be to allow your child to earn commission or an allowance by doing chores around the house, for a neighbor, etc. By creating jobs in the house such as emptying the dishwasher, taking out the trash or cleaning the bathroom you are teaching your child responsibility and how earning money works. It is also important to teach your child the power of giving! Let them take a small piece of their earnings/savings and give to a charity of their choice each month.
Recommended books: The Toothpaste Millionaire, Lunch Money, Lawn Boy and The Short Seller.
The teen years! These are the last years you will truly influence your child’s decision-making skills. During this time, take them to community Bank of the Chesapeake for a bank visit, so that they can learn about money management, investment, interest and more. You could consider letting them get a part-time job so that they can discover how to prioritize their time and money. And last, but certainly not least, teach them the danger of credit cards; make sure they fully understand how a credit card works before they end up in a puddle of debt.
Recommended books: Everyone’s Commonsense Guide to becoming financially independent and Eyewitness Books – Money.
Throughout anytime in your child’s life “practice what you preach”! As a parent it is your responsibility to not only teach your child but show your child through your actions. Set good examples for them. If you’re continuously arguing about money, they will notice. If you always pay with plastic, they will notice. So always live by what you teach. Take them to open a bank account at a young age so they can plan for their future and learn the privilege of saving.
Don’t forget to always keep the communication line open about money. Teaching your child to save from early childhood is important for your child’s future spending habits. Help your child to understand and learn accountability for his or her financial goals.