Teaching Your Kids Good Saving Habits

Jan 4, 2022 | All Posts, Blog | 0 comments

Teaching your kids good saving habits is one of the most practical ways that you can set them up for success. Kids who learn the basics of saving and managing money from a young age will not only possess important life skills, but also the confidence that comes from feeling equipped for the future. However, teaching your kids good saving habits might be a little bit more involved than teaching them to jump rope. We’re going to share some ideas that you can use to help your children learn important financial skills.

Delayed gratification

One of the main drivers of future financial success is delayed gratification. As adults, we have some understanding that if we don’t spend the money now, we will have more later. If you don’t purchase a $5 latte each day, you’ll be $150 richer at the end of the month. While it makes sense to us, for kids, this concept isn’t always so easily grasped.

How to teach kids delayed gratification

Teaching your kids delayed gratification from a young age can be challenging, but they will certainly reap the rewards later. Try challenging your child with a token such as a piece of candy. Offer them the option of eating one piece today, or saving it and getting two pieces tomorrow. You can take this even further by offering four pieces the next day if they decide to save the two. Compounding is very unintuitive, so using something small such as candy is a helpful, visual way to teach children this concept.

If your child receives an allowance or receives money from gifts or small jobs, this is an excellent opportunity to teach them how to save for what they want. Each time your child sees something they want, put it on a wish list. Instead of purchasing candy or token treasures with their money, explain to them that they can save it each week in order to purchase an item off their wish list. It may be helpful to create a visual that depicts the price of smaller items versus the item for which they need to save longer.

Other ways to teach kids good saving habits

When you’re young, it’s difficult to understand the value of a dollar. Getting a job can be an excellent step toward this goal. If you have young children who aren’t old enough for a real job, create jobs for them yourself. Think of some tasks around the house or yard that are above and beyond their normal duties as a member of a family. Then, assign a wage to each job. For example, washing all the windows = $5, organizing the shoe closet = $3, etc. Of course, the tasks and wages assigned will vary based on the ages of your children. Then, the next time your child wants something, whether it’s a toy from the store or pizza for dinner, you can go to the task list and show them what it would take to earn that much money. This allows them to see that purchasing anything isn’t as easy as simply handing over dollar bills. (This isn’t to say that you shouldn’t purchase anything for your children! It’s simply one way to show them the value of a dollar in terms them will understand.)

Modeling good financial behavior yourself is one of the most important ways to teach your children the same skills. Children pick up on almost everything you do, so being responsible with your own money will teach them more than you may know. Do you spend less than you earn? Do you often make flippant purchases? Are you putting away money for the future?

Another idea is to occasionally involve your children in minor financial decisions, such as grocery shopping. Let them know the grocery budget for the week. Then, sit down with your child as you make a grocery list that stays within the budget. Take your child shopping with you, and demonstrate how to stick to a list and to a budget.

Set your children up for success!

Teaching your kids good saving habits doesn’t have to be a drag. It can be lots of fun! You can enjoy some fun learning opportunities with your kids while teaching them valuable skills. We hope some of these ideas help you as you teach your children important life lessons.

If you have any questions about your financial future, we’re here to help. Setting yourself up for financial success will not only be a gift to yourself, but to your children as well. We want your family to be ready for whatever the future brings. Contact us today!  


This material is not intended to replace the advice of a qualified tax advisor, attorney, or accountant. Consultation with the appropriate professional should be done before any financial commitments regarding the issues related to the situations above are made.

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