Empower Your Kids with a Student Savings Account

Learning how to manage money wisely is an important skill that can set children up for financial success in life. But it’s harder to explain the value of money in a society that is increasingly cashless. When children don’t see real money being exchanged, it’s harder for them to grasp the basic concepts around how it is earned and spent on things they need and want. By the time they are entering school, children are at a crucial junction for developing how they think about money. Starting and shepherding a student savings account – along with other financial literacy lessons – can set your young one up for success.

Today’s guest blog is brought to you by our friends at Ohio Credit Union League.

In a CNBC Survey, 83 percent of U.S. parents said it is their responsibility to teach children about money; yet only 15 percent talk to their children weekly, and 31 percent never do. But where to even start?

Our friends at Ohio Credit Union League are here with some tips to make money and savings a regular topic of conversation in your home:

Start early and make it fun

Children love to role-play. Play simple games with preschoolers that involve pretend money and food to help them understand the concept of making purchases. Use coins to teach counting and involve them in making grocery lists, reading price labels, clipping digital coupons in grocery store apps, and making selections at the store. Remind them of their student savings account and how money not spent on items can be saved.

For older children, playing board games like Monopoly or The Game of Life teaches them to strategize and focuses on the importance of budgeting and saving for the future. There are also educational apps that teach older children how to save in a fun way — with games and rewards they can earn along the way. When money comes their way — from birthday gifts, chores, allowance, etc. — encourage them to set a portion aside in their student savings account.

Student savings accounts help kids set savings goals

Children may be more motivated to save when they have a specific goal. Talk with your kids about wants and needs and help them set age-appropriate goals. Then brainstorm ways to earn money for things they want. Again, this could be doing chores at home or for family members, pet sitting, or getting a part-time job as a teenager. Creating a visual reminder of their progress can “gamify” saving and can provide a fun arts and crafts project to share.

Build your student savings account by saving at home

Use a clear jar to save money at home instead of a piggy bank. Once the coins reach the top of the jar, help kids count it to see their progress. As a reward, let them spend a little when they reach a milestone. Consider matching your child’s savings to help them reach the goal faster. That will keep them motivated and they are less likely to spend their money sooner. Don’t forget to celebrate when they reach the goal!

Practice strategy by making a budget

Use simple language to teach children how adults earn money and make spending decisions. Ask them to help write a budget for basic needs like mortgage or rent, food, car payments, and cell phones. Explain how your family handles any shortages each month and what your savings goals are, such as a new car, vacation, and college. Include a savings line on the budget to help children get into the habit of saving each month. Explain how your savings account(s) are set up, and how it is similar to their own student savings account. Don’t forget upkeep costs like taxes! Children need to understand that we don’t keep everything we earn.

Bring it back to their Sparky account

A Sparky’s Kids Club Savings Account is a brilliant option for your child’s student savings account.  Parents can monitor spending and make deposits in any of our branches and from digital banking. Plus, your children will receive a quarterly newsletter with activities, games, a coloring contest, and further financial literacy learning. There are plenty of fun extras, too: a birthday card from Sparky the Dog, in-branch goodies, a chance to win prizes, special events, and more. Open your student savings account with FFCCU today.

Talking about money can be as natural as deciding what to have for dinner, if you make it a regular practice. When children learn good money management skills and a head start on saving, they have a solid foundation for achieving financial independence later in life.

Posted In: Guest Blog, Sparky's Kids Club