Teach Kids How to Save, Spend, and Share

It’s possible that your kids received money for Christmas. If you’re struggling with how much to let your children “spend,” consider setting up three small boxes in your child’s bedroom or buy a container with three drawers. Label one drawer or box for saving, one for spending, and one for sharing. As children receive money, set up a system where a percentage automatically goes into each section. Then, your child will learn to utilize his or her own money to buy something, put into a savings account, or donate to a favorite cause or charity like a local food pantry.

Daily life presents many other occasions to help children understand money and how to use it well. Children learn by playing, by imitation, and by participation. The key is to suit activities to your child’s age, interest level, and attention span. See examples below.

  • Give children age five and younger some mixed coins to count as objects. As children grow, help them identify coins and count them as money (one nickel, one dime, two pennies—that’s 17 cents).
  • Your children might not be ready to understand the concept of saving money for college, however, they can learn to save their money to
    buy a book or toy. Young children need rewards to reinforce their saving habit. Therefore, plan out saving goals. Then, when your child achieves one goal, encourage selection of a new goal.
  • When the piggy bank at home has a few dollars in it, bring your child to the credit union to open a savings account and make a deposit. The credit union welcomes children’s accounts and will reinforce your messages about smart money handling. Set up routine visits to the credit union to show how savings really add up.
  • Ask your child to help make buying decisions from time to time. Say, “You decide which cereal we’ll buy this week,” and offer two or three acceptable choices. To help your child evaluate the choice, later ask, “Are you glad you picked that one? Would you choose it again?”
  • Express out loud some of your own goals, options, and decisions as you shop. Say, “We won’t go to a movie this week because we’re saving for vacation.” Or, “This fruit looks old—it’s not worth spending the money on it?”

For more articles like this, visit “Member Resources” on firstnebraska.org. Reprinted with permission. Home & Family Finance® Resource Center, Copyright © 1997-2016 Credit Union National Association Inc.