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Saving versus Spending For Kids

Save Money

save moneyWith all the articles posted last week, we can now say we know the basic of saving and spending money, but what about our kids? What about the kids? Saving and spending money are two different words that a 5 year old would hardly understand. How do we teach our kids to save and spend money? For adults, it can be easy for us to say which is which and for what is what. But for kids, they might have a hard time understanding the two words.

The trick I’ve learned about teaching kids in saving money is through a game. They call the game Bill-Paying Game, which was taken from a scene in a movie called “I Remember Mama.” This game requires play money. This play money should indicate an amount and due date. Let your kid practice how much to pay for a minimum payment, balance due or date due (it’s just like your kid is required to pay bills for his or her home). If your kid has enough money to pay for the bill, it means he or she wins. This means your kid has enough to spend the money for paying bills and the extra money for savings.

Another tip  is to use a toy bank or a wallet for safe keeping. These accessories can encourage kids to save money. We should always ask them how much they put in their wallet or their piggy banks. We should also help our kids count the money they save. If you see progress with their savings, acknowledging and praising them should make them want to continue saving more money.

If we train our kids to save money, we are training them to be a non- impulsive buyer. At some point, we give them lectures on how interest works with banks and help them understand how finances are handled at a younger age, which eventually helps them work on their finances when they grow up.

We shouldn’t expect our children to save all of their money. They need to know that it is okay to spend money sometimes just on things they want. However, they need to understand that it is important to save too. They should be taught that the necessities in life come first so that they are able to budget when they are an adult. The earlier that they learn to save money, the more likely they are to do so when they are adults.

Therefore, aside from teaching our kids schoolwork, we should also teach them to save and spend money. This will help them manage their finances when they get a little older.

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