How to teach your child lessons about savings

Savings

How to teach your child lessons about savings

Published July 25th, 2020 9:59 am

Teaching children about the importance of money and savings might be a tough job for parents. But if a habit is developed at a young age, it is likely to say forever.

Here are 4 ways to teach your kids about saving money:

  1. Gift your kids a piggy bank. These money collectors are available in many colourful and lively boxes to attract children. Tell them that they need to fill it up, and once they do so they can use some of the money to reward themselves with a scoop of ice-cream! This method acts as positive reinforcement and will help the kids to stay focused on their goals.
  2. 2) Open up a bank account. Once your child has saved a portion of money at home, take them to a bank and help them open up a savings account. This experience will not only take them a step further towards saving but will also give them exposure to the concept of banks. Banks like Bank Al Habib have launched ‘Young Savers Account’ where kids below the age of 18 can keep their savings. You can even open your Young Savers Account with as little as Rs. 5. Moreover, the rate of return on the account is expected to be well above the return on normal savings account. For more information go on https://www.bankalhabib.com/personal-banking/PKR-saving-account/young-savers-account.php
  3. Have a conversation with them. Discussion is one of the most powerful tools to get children to understand something. Rather than being afraid of answering their questions, consider these discussions as teachable moments. Tell them the importance of money and how they can spend wisely. Most importantly, discuss your own trials and errors with them. This way you can emphasize your hard work and responsible spending.
  4. Give your kids an allowance. Meaning, give them a set amount every week and let them decide how to spend/save that. But also tell them that they need to save for the things they really want. For example, if they want a new cycle, tell them that they need to contribute 25% of the total amount required. This way they’ll learn self-control.

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