Resolve to Save While Teaching Your Kids to Save, Too!
With the start of the New Year, many people will make the resolution to save money in 2014. Maybe you are one of those people. While you resolve to save, this is also a good time to teach your children how to save, too!
Here are 10 simple ways to get your kids on the smart path to saving money:
1. Set goals. First, set your goal. It can be as simple as saving $300 on your grocery shopping for the year or as much as saving $1,000s towards your child’s college expenses over a period of years. Share your goal with your kids. Next, have them set their own goals. Maybe they would like to save up enough money to buy a video game, maybe they would like to buy their own iPads, or maybe they would like to set money aside for their college education.
2. Set a timeframe. Decide how long it will take you to accomplish your goal. Will it take you a week, a month, a year, or more?
3. Divide up your goal. Break down how you’ll accomplish your goals. For example, if your goal is to save $300 on your grocery shopping in a year, your goal would be to save $25 each month for 12 months. If your child’s goal is to save $50 for a video game over four months, then their goal would be to save $12.50 each month for four months. You can even break that down further by weeks or days, depending on which makes the most sense to you.
4. Create actionable steps. Figure out what you need to do to accomplish your goal. For instance, to save money on your grocery shopping, you could use an app like Favado to find deals and coupons and you could use rewards cards to help lower the cost of your groceries. You could also attend a workshop that teaches you how to easily save 50% or more on your grocery bills. For your kids, determine if they will earn the money through chores, saving monetary gifts given to them, or through getting a job (depending on their ages). With the chores, come up with the amounts they can earn for helping around the house, like $1 for washing the dishes. You can encourage them to sell some of the toys they are no longer using to earn money to buy a new toy they have been eyeing. If your child is into arts and crafts, they can sell their creations to make some extra money. Even if it is just selling it to family and friends, they will feel a sense of accomplishment. It also helps them put more value on the money if they know the effort it took to earn the money.
5. Use cash. Most people use debit or credit cards for their purchases. Sometimes kids don’t understand that you have to have money in the bank in order to use those cards. By using cash, you are not only showing them that you are spending only what you can afford, but you are also teaching them about currency. Letting them count out the money will also enhance their math skills. It’s a great visual for them to see how much money they are saving, so use a piggy bank or wallet for them to keep their money. If they are older or if the goal involves a lot of money, opening up a savings account could make more sense for them. Having a savings account would teach your kids about how money can grow when you don’t spend it until needed.
6. Make wise spending choices. For adults, we sometimes have to decide if buying another cup of coffee will affect our savings goals – one cup may not make a dent, but a cup a day could make a big difference. Explain that to your kids, too. Teach them that buying the occasional pack of gum may not make a big difference, but buying a pack of gum a day could eat up their savings quickly. Help them see the bigger picture (and remind yourself of the bigger picture while you do so).
7. It’s okay to have setbacks. Just like with any New Year’s resolutions, most people will start off great and then have a setback. As long as you get back on track, that is all that matters. Showing your kids that it’s good to follow through on your goals, but that it’s also okay to have a setback and to learn from it, will do wonders for them throughout their lives.
8. Keep a chart. Create a chart that shows your end goal (like they do at blood drives or fundraisers). Color it in as you start achieving your goals. Have your kids create a chart for their goals. Hang them where you will see them regularly so they can serve as reminders and incentives to strive towards your goals. Have a regular check-in with your kids. Share with them what you’ve been doing to achieve your goals, what’s working for you, what’s not working for you, and have them share the same with you.
9. Make smart saving and smart spending a part of your life. Your kids will learn the most by watching what you do. As you incorporate these smart decisions on how to spend and how to save money in your own life, your kids will see what you are doing and will more likely do the same. Let them help you make some of the decisions. For example, while you are at the grocery store, show them the different prices of different items and sizes. Let them figure out which is a better deal. Give them the coupons to hand to the cashier. Have them watch the totals go down at the register. Show them what price you started with and what you ended up paying out of pocket. Explain to them that by being a smart shopper, you were able to save money that can be used for something else. If you are able to, put aside the money you saved so you can show them how even saving a few cents here and there can add up to some big savings in the long-run.
10. Reward yourself and your kids. Once you’ve accomplished your goals, make sure to reward yourself and your kids. Let your kids know that they have a lot to be proud of by sticking to their goals and accomplishing them. Make sure they know when you’ve accomplished your goal, too, because if they are still working on theirs, it will serve as inspiration to keep going. Of course, if their goal is to buy something, make sure to teach them how to get the best deal on it and maybe they will have something left in their savings to put towards a new goal.
There are many ways you can make it fun for your kids to save. Turn it into a game. You can even make one of the chores you pay them for a challenge on who can find you the best deal on buying peanut butter or ice cream. The best part is that your kids will not only learn from you, but you’ll probably learn a thing or two from them also!