Learning to save money from a young is vital to building healthy financial habits. Children learn many important things from school, however, financial literacy is not one of the skills that schools teach children.
Learning to save money can help children develop financial habits, which will help them better manage their finances when they are older. Like any good habit, learning to save money takes time and practice. Therefore, teaching your child this skill from a young age can help them develop financial habits that will help when they grow older.
With July being savings month, we came up with some tips on how to help your child learn to save money.
In an article by Forbes magazine, co-creator of Sammy Rabbit, a children’s character and financial literacy initiative Sam X Renick, said children should learn about money from a young age.
“Money is central to transacting life, day in and day out. Where we live, what we eat, the clothes we wear, the car we drive, health care, education, child-rearing, gift-giving, vacations, entertainment, heat, air-conditioning, insurance—you name it, money is involved,” Renick told Forbes.
READ MORE: Tips on how to save for school fees
Aneesa Razack, CEO of Share Investing at FNB Wealth and Investments, concurs with Renick’s sentiments.
“I am motivated by a famous African proverb, ‘Train a child the way he should go and make sure you also go the same way’. This is the cornerstone to enjoying parenthood and the reason I have become intentional about what I teach my child including, their behaviour with money,” says Razack.
Razack shares the following tips on helping your child learn to save money.
Talk to your child about money
Most people avoid talking about money, as it is a difficult subject to talk about, however, talking to children about money will help them develop healthy habits with money. Avoiding conversations about money can lead to a lack of financial literacy.
Teach them how to budget
Budgeting is an important part of learning how to handle and look after your money. By learning how to budget, children can learn how to make their money work for them. FNB Product Head, Money Management, Ester Ochse, says parents can teach their children how to budget, by involving them when they do their monthly budget–as this will allow children to have first-hand experience.
“A great start to help your children track where their money is going is by having an up-to-date budget. Your children’s budget should include their savings, expenses and those events that they enjoy doing like going to the movies, purchasing toys, books etc.,” says Ochse in a press statement.
Lead by example by having good financial habits
Children learn from what they see and lead by example by showing them good financial habits. One of the things that you can do is encourage them to save for the things that they want. Instead of buying them everything they want, let them save for it. Teaching your child to save for what they want allows them to value money.
In conclusion, teaching your child good financial habits is important in helping them become successful later in life. As we celebrate National Savings Month in July, we encourage you to continue to teach your child the importance of saving.
