How to help your child learn how to save money
Learning how to save money from a young age is vital to building healthy financial habits. There are many things that children learn from school, which leads to a successful future; however, saving money is not one of them.
Learning how to save money will help your child better manage their money when they start working or run their businesses in the future. Like any good habit, learning how to save money takes time and practice. Therefore, this skill must be honed throughout childhood into adulthood. Saving is part of financial literacy; if your child can get it right young, that means they can make better choices with their finances in the future.
With July being savings month, we thought we could put up some tips on how to help your child learn how 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 that ‘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 that 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
You must have conversations with your child about money. Having a healthy relationship with money as a parent will determine the conversations you are having with your child about money. You must be having a positive discussion about money with your child. Remember that the outcome you want is for your child to build healthy financial habits instead of bad ones.
Teach them how to budget
Budgeting is so important in knowing how to handle money and look after your money. With a budget, children can learn how to make their money work for them. FNB Product Head, Money Management, Ester Ochse, say you teach your child how to budget by involving them when you do your monthly budget. This way, your child can have first-hand experience with budgeting.
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
As a parent, you know that children learn from what they see, so show your child how to manage their money by spending wisely.
You can exhibit good financial habits; these include showing your kids how you budget, teaching them to save for what they want instead of you constantly buying it for them. This could be saving for a toy or a book. Teaching your child to save for what they want allows them to value money.