Saving money is a wise financial practice at any age. Teaching kids the habit of saving money will always be the standard. Whether they earn as little as 200 naira for a job well done or get cash gifts for celebrations and events, teaching them the habit of saving rigorously as they grow is a motivating factor in becoming financially knowledgeable. Children who are taught to save up early grow up to be better savers and even more disciplined with money than their parents were.
Young children should be taught how to save early, as soon as possible. And with time, as they grow older, they are moved from the regular piggybank to a savings account. This would guide them into responsible adulthood with sufficient knowledge of money and how it works. Kids can be taught how to save by motivating them with different activities and keeping an open book of the inflows and any outflows that would occur and how that would affect their financial future. No kid is too young to learn to save and prepare for their financial future.
Children can be taught to save by having them set a goal. Once there is a clear-cut goal and the amount needed to reach it, then a percentage of any income would be put aside and saved towards it. This goal for kids needs to be something achievable at a good time to keep the child motivated. It could be as little as their favourite snack.
There are numerous benefits to saving money for both kids and parents, as it keeps you on track for certain goals. Your savings also provide a financial backstop for life’s uncertainties and increase feelings of security and peace of mind. It is always a lot easier to save for something specific than to save for something’s sake. So, if you are a parent, you might want to label each saving plan accordingly for your kids’ financial needs. For example, you might need to save for your child’s other 2nd-term school fees if they pay per term. If not, you might need to save towards the school’s vocational activities that require a separate payment from the total sum of the school fees. Kids need to pack lunch and midday meals, and this would also cost a certain amount of money that differs from the school fees.
Steps to Help You as a Parent
Keep track of your spending and earnings: Keep track of your expenses If you find it difficult to save regularly, try to record and keep track of your weekly and monthly expenditures. This will create a month-on-month comparison of how much you spend and earn, giving you a clear ratio of what is to be saved per time. This will help you identify unimportant purchases and avoid them to save more.
Create different budget categories for different things: It helps to devise a budget for each month. Budget categories will help you target your savings and limit spending, a budget will help create a scale of preference that puts important purchases first, which reduces the chance of overspending and lets you save.
Set up an auto-debit saving plan: Automatic savings can help you pay yourself first. VaultLite is a plan on Vale that helps you save by paying yourself first and earning interest while you are at it.
Essential Reasons to Save as a Parent
- Saving helps plan for short-term goals.
- Saving gives security in emergencies.
- Saving can help you provide for your children’s needs and dreams.
- Saving helps build a better future. i.e., saving towards college fees for children.