Sunday, 15 May 2011

5 Tips for parents to teach children to save

Tips for parents to teach children to save:

• Set goals. Have children list all the things they want and the anticipated cost.

• Open a savings account. Around age 5, children begin to understand the process of managing money. That’s a good time to open a savings account with them.

• Pay a modest allowance. Try a dollar a week, or a set amount, for each year of the child’s age. More important than how much is that everyone understands the rules up front — including the completion of necessary chores — and that you pay the allowance consistently and on time.

• Make a plan for spending, saving and giving. Encourage children to divide their allowance and any additional earnings three ways: money for spending, money for saving and money for giving to charity.

• Use free resources. There are many free and reputable places where you can find helpful guidance to teach children about savings and finances. These include your public library or Hands on Banking, a program available free.

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