4 Important Reasons To Teach Your Kids To Save

It is often said that parenting is the hardest job in the world. You have the privilege and responsibility to teach your children how to navigate the world and inspire them to put their own stamp on it. You enlighten them on everything from their education to work ethic to health and oversee the remarkable journey they will embark on as they grow up.

In the hustle of homework checks, piano lessons, soccer practices, and more it can be difficult to remember to talk with your kids about money. Money is one of the most important topics to discuss and teach your kids to manage. It will follow them in each stage of their development, and it is essential to help instill a healthy relationship with it. One way you can do this is through teaching your children the importance of saving.
While there are many reasons this lesson is worthwhile, I will highlight the top four reasons to teach your kids to save.

1. Develop a healthy relationship with money

Money is something that infuses each aspect of our society. It is how we pay for school, houses, food, and entertainment. Its omnipresence makes it imperative for children to understand and feel comfortable talking about.

With money being the leading cause of stress among today’s adults, it is important to give your children as much information as you can in order to prepare them for their future. Many people can trace their issues with money to their childhood experiences. You may think that you have to shield your children from money-talk, but it is important to include them in some conversations, especially about saving, and teach them practical financial habits.

When you start talking early, you give yourself more time to instill practical and logical lessons such as saving money. This free and honest line of communication will allow you to show your children that money is not a taboo subject and that it is important to talk about. By normalizing a conversation about saving and spending intentionally, you show your kids that you don’t have to talk about money in terms of fear or anxiety. This tactic will help your children look at money from a healthy perspective.  

2. Goal-oriented mindset

When you teach your kids about saving, you get them thinking about their long-term goals. One of the most difficult things about money is saving and not spending simply because you can. You can help your children figure out the things that are important to them and those will change over time. Here are a few questions you can have them answer:

• Why do I want this item?

• How will this item help or hurt me?

• Do I have enough money to buy this item?

• How much money will I have left after I buy this item?

These questions are designed to help teach your kids the value of spending in a way that aligns with their values and what is important to them. It will help curb impulse spending and spending money simply because they filled their piggy bank.

You can’t have a conversation about saving without talking about spending. It is important that you help your kids strike a balance between the two so that they don’t fall into either extreme: saving too much or spending too much. You don’t want your kids afraid to spend money, you just want to teach them that spending money does have consequences and if those consequences are positive, they will feel more fulfilled with their purchase.

3. Delayed gratification and planning for the future

Our society is inundated with instant gratification. It seems almost anything is available by the push of a button or sound of a command. But when you teach your kids the value of saving money, you are also showing them the importance of delayed gratification and looking toward the future.

So much of financial planning is aligning financial practices that will help you in the future and in the long run that it is important to teach your kids as well. Sometimes instant gratification can get people in debt, so it is critical to show that saving and waiting can pay off.

For example, if there is a new toy that your child really wants you may encourage them to save up money from their chores, etc. for it. This practice will discipline them to save the money that they earn so that they are then able to purchase the product they want. By physically doing this themselves they learn that sometimes you have to wait and work for the things you want: a lesson that will never get old.

This strategy also makes them more consciously aware of how much things actually cost and can motivate them to save more. Saving is a tough thing to do, even for adults so by instilling this practice younger, your children will know both how and why to save.

4. Setting up future financial success

Saving money is a wonderful skill to teach your kids because it will directly impact their financial future. There are so many things in life to save for: education, wedding, vacations, retirement, etc. Your kids will understand how saving influences their ability to do the things they want and how to prioritize their wish lists. Every parent wants their kid to be successful, and by teaching your children the practicality of saving, you are setting them up for being able to save for the big things they will do in their life.

Saving is one of the most basic financial practices and something that each person should know and understand. Take some time to talk with your kids about the importance of saving and allow them to practice it by saving money in a piggy bank or save jar. But don’t just stop there, ask them to consider the whole picture before they buy something. Have them think through these three things:

• Goals

• Value

• Intention

If they are able to discuss these three items before purchasing something, they will be prepared for their savings future.

If you would like to talk about ways to integrate children into your financial plan, give us a call!