I’ve been mulling over the exact wording for this post’s title for a while now, quite simply because as it is today, saving money doesn’t quite hold the value it used to when I was growing up. It’s perhaps a better idea to teach one’s kids how to invest their money rather than purely saving it, but I guess the terms “save” and “invest” can be used interchangeably too.
I’ve been at it for quite some time now, teaching my own boys all about saving and the importance of putting some money aside. Whether they choose to implement what they learn or not is ultimately up to them, but at least they’ll have some knowledge to draw on if they do decide to embrace the importance of putting a few coins aside for later use.
Finding a Meaningful Purpose to Save
It’s all good and well telling your kids that they need to put some of their money aside and not spend it all, but until they themselves have found a personal reason to save, it’ll be rather difficult to ensure they do indeed save. The personal reason could be anything really, just as long as it can be directly linked to the clear need for saving, like perhaps if your child wants to go out to the movies every other weekend, that would be a great incentive for them to learn the importance of saving by being a little clever with how they spend their pocket money.
Getting Everybody In On It
In my specific case what I mean by “everybody” is my husband, but basically you just need to ensure everyone directly involved in your children’s daily lives is in on the lesson you’re imparting. It’s especially important in my case because with my husband being away a lot of the time, he naturally wants to spoil the kids a bit whenever he’s back to spend some time with us. Understandably so his wallet is a little quick to come flying out of his pocket, but he was very quick to come around when I relayed to him my plans to progressively teach the boys the importance of saving.
He now adopts a subtle “meet me halfway” approach to buying the boys anything they want, especially if it’s not something they particularly need, but would rather just love to have. Basically they have to wait until next time to get what they want, whenever that fixed future date may be, but they have to come up with some of the money themselves while he’s willing to put up the rest of it. The only way they really know how is to save some of their pocket money. Some valuable lessons beyond merely saving sort of come as part of the whole exercise though. In addition to stowing away their lunch money and carrying sandwiches to school, they also explore some ways of making some extra money on the side, like doing the morning paper routes and negotiating for some “wages” in exchange for doing some extra house chores.
At some stage if you want your kids to really get serious about learning to save and invest, you’ll have to go beyond the piggy bank and formalise their savings. A kids’ savings account is a great way to start and banks these days have some great financial products which are specifically geared towards not only teaching kids how to save, but also how they can make their saved money work for them, even if the return on investment margins are very small. It’s all about the lesson.