You save part of your paycheck (or at least you try to). Does your child have a savings account for kids where they can deposit part of their allowance, birthday money or Christmas cash?
Saving money is a great habit that can help your kid develop great habits and behaviors for later on in life. Parents and grandparents can help develop these habits by opening a Tracker Kids Club savings account for kids with us.
But what benefits does saving early actually have other than increasing the amount of money your kids can call their own? Keep reading to find out why saving early can set your kids up for a successful future.
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Learn the real value of a dollar
Kids who ask their parents for money to buy things don’t really understand where it comes from. It’s hard to associate the good or service they purchase in a real monetary value if they aren’t spending their own money.
A savings account for kids helps them associate a dip in their account balance with what they just purchased. They’ll learn if what they just bought was worth it, and start to make purchases more responsibly.
Plan for bigger purchases with a savings account for kids
Major purchases like TVs, phones and video game systems don’t just show up out of thin air. They take planning and budgeting to make happen. By saving money from an allowance, small jobs or their birthday, and watching it grow over time, they can see just what goes into making a major purchase.
Become self-reliant and independent
If you give your kid an allowance, that’s great. If not, do they earn money from doing small jobs around the house? Seeing their savings account balance grow each time they earn money can help instill a can-do, entrepreneurial spirit in your kids. They’ll start to go out of their way and create new ways to make money on their own.
Learn how to stay out of debt
Credit cards can sometimes encourage impulses for immediate gratification. You can buy what you want, when you want, and then pay it off later. This type of behavior could lead to debt and interest that add up, fast, when they become adults.
Teaching your kid to save money for what they want to buy could help teach them that buying what you want is a long-term game and not an immediate need.
Does a savings account for kids buy happiness?
It’s cliche, but money doesn’t buy happiness. What money does buy is opportunity and freedom to make decisions. Starting a savings account for your kid early will help them make more decisions for themselves.
