As a parent you know that saving for your child’s future is important. You may have established several different methods for saving for them including education funds. While it is important for you to save for your child, it is just as important, if not more,to teach them to save for themselves. Here are a few ways to get them started saving for a new car, college, travel, and other expenses.
Open a Savings Account
If you haven’t already, start a savings account in your child’s name with you as a joint account holder. If you established an account for them when they were young, now is a great time to share that information with them so that they can take ownership and feel that they can contribute to it as well.
Teach Important Principles
You may know and incorporate the principle of “paying yourself first” where you put money in your retirement fund, your child’s education fund, and your personal savings before paying bills or spending any of your paycheck. Share this principle with your teen to help them understand the importance of saving. (You can also share other principles such as giving to charities or tithing if it is part of your family’s financial life.)
Have your teen share with you their future goals such as whether they want to save for a car, if they’d like to take a trip after graduation, and any other plans they have that involve a substantial amount of money. Once you determine their goals, encourage them along the way. Don’t micromanage all of their financial decisions but try to be an accountability partner to make sure they stay on track.
While you may save most of the money for your teens future goals, any amount they can contribute will help them learn the life-long skill of saving as well as instill in them pride of ownership
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Categories: Kids and Money, Saving, Students