Ages and Stages for Teaching Kids to Save

By Linda Carlson

There are really only three things we need to teach our children about saving money: Save as much as you can, as soon as you can, as long as you can. As helpful as this is, most of us could use just a little more detail on how to build a savings mindset into our kids from preschool to college. So, here are a few tips and resources that can get you started.

Get an Early, Biblical Start

Teaching your children to save is an investment in their future and purpose. How they view and use money will determine much of the opportunity and freedom to give they can enjoy as adults. Larry Burkett of Crown Financial Ministries has a wealth of information on what the Bible says about saving money.

Preschool — Elementary

Ask 10 couples how to raise a child, and you’ll get 30 different answers. But when it comes to teaching kids money saving skills, there are actually a few basic financial principles that most agree on. We came across tips from 36 different parents on teaching money saving strategies to your kids, including helping them set realistic savings goals and, ahem, setting a saving example.

As Christian parents, this is also the ideal time to instill in children the purpose of money. Financial expert Dave Ramsey believes teaching the value of money and saving can help in the overall development of your child. Ramsey shared a helpful breakdown of how to teach kids money management skills throughout childhood.

One way to help kids grasp the concept of money and saving is with a simple Give, Save and Spend bank that can help introduce the idea of delayed gratification, tithing and just being generous. It’s simple to make your own GSS bank, but you may want to look it up later, or you may be browsing for an hour.

Tweens — Teens

As your children mature, share with them the connection between simple saving and long-term investing. One excellent example is the story of Joseph and how he handled the great famine (Genesis 47:13). Many Christian parents build a financial framework around the Bible to help practically introduce basic money management. Focus on the Family offered some additional verses and simple tips here to help teach your teens about money.

And while we’re talking about teaching, nothing provides better motivation than learning how saving money makes money—a.k.a. compound interest.

Now is a great time to get the compound interest ball rolling. Start by opening a savings account for your teen and help them start building a bank of their own. To help build up the reserves:

Deposit money into their account for clothes and toiletries and let them manage it on their own. What they don’t spend, they can keep.

When the cash gifts arrive for birthdays and graduations, set a limit on what they can spend, and deposit the rest into their account. Even if it’s spent later, it’s a healthy practice to instill.

Make a financial budget. Don’t worry, with the little they’re making, it won’t take long to create. Once they see how much they’re actually spending, suggest inexpensive, fun activities they can enjoy with their friends.

During all these teaching moments, it’s also meaningful for teens to see that you are doing what you’re saying. If you have a method, discuss and demonstrate how you spend, save and share. While you don’t have to give details, you could say something like, “Out of each paycheck, I spend 60% on our family’s needs and wants, put away 25% for savings, and share 15% which goes back to God.” And there are countless other ways to divvy up your income, like the 10-10-10-70 plan that differentiates between savings, giving and tithing, similar to the GSS bank mentioned above.

Young adults and Students

And for those high school students, and those heading off for college, or going to work here’s a final 4 for teaching savings:

All things are possible. Ask them to save $15 a week to start. Put the money in a separate savings account, or even a joint account, so it’s not easily accessible.

Remind them to live like, well, a college student. They have to face the fact that they’re poor, so they can’t spend money they don’t have. Just learning this will be quite a valuable education.

Explain how Credit Cards are not Free money, and to only charge what they can truly afford to pay off each month (and fits into the budget). If they easily overspend, suggest leaving the card and only taking the cash they can afford to spend.

Finally, the big bank on campus may not always your best bet, so think outside the bank, like a credit union. Often a credit union can provide better rates on loans, and checking, and savings accounts, along with money saving specialties like cash-back credit cards.

Beginning with these small actions can help your kids get a serious boost to their balance.

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