Being able to responsibly save money is a skill many of us lack, but so desperately want to pass on to our children. As adults, we understand how important it is to have a nest egg tucked away for rainy days, and how not having good money management skills can have a devastating effect. This is why your children should start saving money today, to give them the skills that will help them throughout life.
It is believed that the earlier you teach your children about saving money, the better equipped they will be to be financially responsible later on in life.
Here are some reasons why you children should start saving money today:
Financial Habits Form From Young
Children form most of their core behaviours by the time they reach 7 years old. At around the age of 7, children should recognize and understand the value of money, and be able to count it out, and know that it can be exchanged for items.
Teaching your children to save money from a young age helps to cement financial habits from early on.
Better Understanding Of Delayed Gratification
Children are able to understand saving from as young as 5 years old. By not giving them instant gratification every time they want something, you are teaching them to instead save up and wait for something better.
Enhances The Ability To Plan
Saving is planning, and children need to have some direction when it comes to saving their money. When saving money, it is important to understand that some decisions need to be considered overtime, and are irreversible once made.
Understanding that saving their money, and not just spending on a whim, will have its consequences, can help them better plan in the future.
Your Guidance Is Golden
How often as an adult have you felt completely lost with different financial concepts and decisions? Children have this confusion, although on a smaller scale. It can be difficult for us to distinguish between needs and wants, and not being able to is where many of us waste our money.
Simply giving your child an allowance is not enough. You have to guide them on how best to budget, save, and spend. This should give them a good idea of how they should manage their money, whether it be an allowance from you or what they earn as an adult later on in life. This guidance can all start early when your child starts saving money from young.
There Is No Harm In Saving From Young
There really is nothing to fear when it comes to discussing money and finances with your children. Being open about these things encourages your children to have a more positive outlook, and they are more likely to approach you with questions.
Understanding that money has value, and needs responsibility from a young age is never a bad thing.
Teaching Your Children To Save Money Leads To Financial Success
There is no doubt that early financial education can lead to financial success later on. This does not mean you should get your 10-year-old to trade on the stock market, but instead, look for resources on how to encourage your children to save money, and all the lessons you can teach them along the way.