How To Teach Money Saving Tips To Your Kids
Kids are never too young to learn the responsibility of saving money and spending wisely. This is a skill that will set them up for success in adulthood, when they're out on their own in the real world. Read on for some age-appropriate money saving tips from Rapid Auto Loan.
Use A Clear Savings Jar
Piggy banks are cute, but their opaque exterior makes it hard to gauge just how much money is in there. Using a clear jar is a more teachable visual, as it allows kids to see how their money grows every time they add to it. Show them how the fifty cents they had last week added up to a dollar this week, and so on. Talk the process through and count it out every time you add to it.
Live By Example
Kids are quick to pick up on our actions, even when we think they aren't looking. They'll take notice every time you take out a credit card at the store and hand it to the cashier without giving it a second thought. Don't let your actions communicate that having a credit card means buying whatever you want. Explain to them how the family budget works, so they know which purchases are vital and which are not.
Show Them What Things Cost
It's one thing to say, "That toy costs five dollars." It's another to dump out the clear savings jar and have your child count it out before taking it to the store. This very simple action will show them the weight, figurative and literal, of what they are spending. It will likely be more impactful than a lecture about finances!
Avoid Impulse Buys
It happens to every parent. Sooner or later, your child will eye something they want in a store and ask you if they can have it. This is a perfect opportunity to encourage your child to use their own money. If she seems reluctant, ask her why. Chances are, she may not have thought through how much she really wants the toy (or whatever it is). It will likely still be available the next day, or the day after that, after you ask her to think it over and weigh just how important it is. Chances are, she will forget she asked for it in the first place...or be okay with waiting for it for her birthday.
Discuss Wants Vs. Needs
Following the instruction for impulse buys is a conversation about the difference between wants and needs. Growing kids will need clothes every year because their previous ones won't fit. New toys that are a current fad when they still have functional toys from last year is a clear "want." Use your own budget to explain how you use money left over for "wants" after all the "needs" have been taken care of.
Set Savings Goals
Kids hate being told to save money but explaining the goals of saving may make them more motivated to try it. That new bike they want? Setting aside some allowance each week, rather than spending it all at once, will help them earn it. Wanting something badly enough will help them learn to prioritize their spending.
Teach Them To Track Their Spending
Good savers know where their money is going, which makes budgeting one of the most vital money saving tips there is. Have your kids keep track of what they buy with their own budget. Writing down their purchases can be quite eye-opening. Learning good budgeting habits now will set them up for success once they become adults.
Money Saving Tips and More From Rapid Auto Loans
You may be good at saving money, but every now and then there comes a time where you need a little extra cash. Rapid Auto Loans can make that happen. We don't require a perfect credit score--just a functional car. Fill out the application on our website to get started, or call us today at 954-960-7097 to learn how car title loans work.
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