Saving money is a necessity in today’s world. With the cost of living growing day by day and the economic slowdown haunting us since quite some time now, it is essential that each of us contributes towards economizing on our expenses. Teaching your child the art of saving money is one such step in making this a successful venture.
Here are a few ways in which you can move in the above direction:
Your child is born innocent. As you start teaching him small things, he begins to learn them. For your tiny tot, you could bring money games and play with him. In each game, you should show by words and actions how money should not spent; rather it should be stored. You could also involve him in a play with coins. Not only will he be introduced to its concept, but also he will learn to drop his money in the piggy bank slot and refrain from bringing it out of the toy bank.
You must develop the habit of saving money if you are to set an example for your son. If you are a spendthrift, then your children will follow suit. So set them a good example. Begin with telling him stories about saving money. Switch off unnecessary lights, fans and electrical appliances of your home in front of him, whenever possible. Specifically explain why it is necessary to do so.
At his preschool age, continue educating him; using a piggy bank. He will enjoy this too, if you ask him to deposit whatever money is given to him in this toy bank. Whenever he requires something, show him how to take out money from the toy bank and now you should use this money for payment (in his presence) of the item/s he requires. The balance money must be restored back to the toy bank.
Take your child walking to nearby stores instead of using your vehicle. Or ask him to ride on his bicycle, with you walking besides. Teach him the importance of money saving through this act and also explain that the exercise will benefit him greatly as a healthy body is less vulnerable to ailments; so not only will he value the importance of remaining fit, but also will realize that getting sick entails handing over money to the doctor and for that to be avoided, he has to walk that little distance. Also, make clear the fact that that comparison of prices is important. He should understand that ‘deals’ and ‘bargains’ cost cheaper and that the items may not necessarily be of inferior quality.
Introduce your kid to the concept of responsibility when he reaches the elementary school level. You can now open a child savings bank account for him and teach him how to use this account; the basics of arithmetic addition and subtraction, interest – conception and other facts. Give him an allowance for the same and inculcate the habit of saving and budgeting. Whenever you use your ATM card or a check, explain the importance of the same to him. He will learn quickly.
Preparing gifts at home is money-saving and inventive as well. Support him in this field and if he is a good artist, it will enhance his creative skills too. He should grasp the idea that this will contribute to saving money.
During his teens, your son may prefer working for earning money. Odd summer jobs, running errands, working at libraries and restaurants may be some of his preferred jobs. Do not deny him the pleasure of such a job. Encourage him to open a checking account and conduct his own transactions in this account. You could keep a check on the same from time to time. This is the time when he will most probably understand the true value of saving money as he has to pay for things from his own pocket. Later on, when he enrolls in college, you could also request a debit card facility in his account and afterwards, a credit card, so that he understands the difference in the two concepts; the first to withdraw money from his account balance and the second to take loan on the basis of his account and that it needs to be repaid in time, otherwise, the consequences will be bitter. At this age, the very idea that he is financially dependent will make him extra responsible for the transactions in his account and he will surely adapt to the economical way of living.
You could teach him simple cooking of easy dishes. Economizing on the same will enlighten him further.
You could spend a relaxed evening discussing with him the basics of long term savings and loans; the college fees and other expenses. Then he also ought to be told of the costs of cars, houses and finally, retirement- planning. You could also gently brief him about stocks and stock market; mutual funds, insurance, etc. and the procedures involved in the same.
It is quite possible that your kid may fumble through the above-mentioned stages in his life. Let him. Unless and until he blunders, he will not learn from his mistakes. Teach him how to set a budgeted financial goal and what he should do in order to reach the target set.
There is nothing more rewarding than seeing your kid striving fiercely to cut down on expenses and getting rewarded for his hard work!