It’s never too early to start saving money for a rainy day. Teaching your kids financial responsibility early on can help prepare them to live financially stable lives in the future. Here is a look at four methods that parenting experts recommend for helping kids save up their money.
Decorated jars.
Many adults have a change jar or a jar set aside for a “rainy day.” Your kids, too, can save up their money in a special jar or two. Make saving money in jars more fun for your child by helping them decorate their jars. Use stickers, photos, cutouts from magazines, and other odds and ends. Your child can decorate their jars with things that they would like to save up their money for, such as a special toy or a trip to Disneyland. Decorate smaller jars for more affordable items and larger jars for more expensive items to teach your child that some things take longer than others to save up for.
It’s a good idea here to also decorate a “spending jar” with your child, which will hold money that can be used for small everyday purchases.
Create a savings chart.
A savings chart is a great way to help your child visualize and track their savings progress. You might set a goal savings amount with your child and set a particular time frame for reaching that goal amount. Maybe your child wants to save $50 in 10 weeks, for example. Create a chart that labels the savings amount (up to $50) on the y axis and the week number (up to week 10) on the x axis. Plot the amount of money in your child’s savings fund at the end of each week, perhaps using large stickers to make it more fun.
Match your child’s savings.
A savings match, where you match your child’s contributions to their own savings, can be a great way to encourage saving—all while giving them a taste of what employer matching for 401(k)s is like. You don’t have to match everything your child saves, either. Maybe you can set a certain amount that your child is expected to save each week and then match anything beyond that that your child adds to their savings.
Set a good example.
Finally, probably the most powerful way you can teach your children to save is to set a good example. Consider creating a savings jar and putting it out on display for your child to see. Add to it regularly, just as you expect your child to add to theirs. This will help show your child that saving money is normal, and it will help reinforce your child’s desire to save money.