When it comes to your kids and money, it’s never too early to start teaching some simple money management habits. Whether it’s an allowance or letting them help with the grocery shopping, talking to kids regularly about money early on will build some financial awareness. Over time as they mature, this financial awareness will build and grow as will their money management skills.
Kids savings accounts in Madison – get started
Kids might get a weekly allowance or a birthday check from the grandparents, but even the smallest income presents an ideal moment to begin teaching your child about financial management. Perhaps they are saving for a new video game. They can begin to appreciate building a nest egg towards that goal by depositing their money into a kids savings account in Madison.
On the other hand, they may also give in during a moment of weakness and decide they really, really want that new toy they just saw today at the market checkout stand. Discovering “buyers’ remorse” is never easy but a valuable lesson never the less. As hard as it may be, it’s important to let them discover the natural consequences of spending all their money – there’s none left for the next thing they want!
Cash, Cash, Cash!
As easy as gift cards are to give kids as gifts, anything other than cash simply doesn’t feel real. Add to that nebulous words like “credit cards,” and anything plastic appears as a never-ending source of income which in fact it’s not.
Instead, go with the piggy banks or mason jar but something where they physically see and count their money. Then, when they go to buy that new game or donate to their favorite shelter, they experience the reality of handing over money and starting to save again from scratch.
Smells Like Teen Spirit
Before you know you it, you now have a teenager in the house. Once you catch your breath, you realize they have more income coming in. Perhaps from mowing the neighbor’s lawn or babysitting. Regardless of the age, this is still a teachable moment. The importance of actual cash continues to apply, as does the idea of saving first. Except this time they may be saving for a new bike, school trip over summer, or college. With these bigger, more sophisticated goals, you can encourage them to continue keeping “their eye on the the prize” and savor the satisfaction of reaching their goals. Use online tools to help them track balances in their savings account.
Will that be Debit or Credit?
Eventually, it will be time to learn about credit and how it works. From credit rates to monthly minimums to credit history, it is a lot to take in. Let Dane County Credit Union help break it down for them, including the difference between a credit card and debit card. By learning how to manage a debit card first, understanding the world of credit will be a little less daunting.
Ultimately we want our kids to feel comfortable talking about money now, and confident about managing their finances as an adult. And DCCU can help.