Kid's Saving

My husband and I are out of debt and saving for college and retirement all thanks to Dave Ramsey's Financial Peace, and Total Money Makover.

He also has some great programs and books for kids and teens:

https://www.daveramsey.com/store//cYOUTH-p1.html

It's all common sense, no credit advice. I highly recommend him to anyone who needs some financial advice!

My kids aren't the age to start saving yet, but as soon as they are I am going to get them Dave Ramsey's Financial Peace for kids. It teaches them how to spend, save, and give. Plus there is a workbook that will help them have great financial sense the rest of their lives. Check it out!:)

Our daughters elementary school had a savings program through a neighborhood bank. We had a parent who volunteered every Thursday morning before school, to make the deposits. It was fun to see the line of children each week. The mom would list the amounts and have the children sign the receipt book. Then she would make all of the deposits. The bank did not charge any fees, but treated this just as serious as other savings accounts. We gave the bank credit as our Partner in Education and made sure to list them as a contributor to our campus.

The committee that ran the savings program sent out the info to every family with suggestions on percentages for children to save, to donate to charity and to be able to keep and spend as they chose. They suggested having 3 piggy banks each labeled for savings, charity and spending. They also had a goal sheet, so the kids could compare it to the savings statements.

It was a great program. My daughter is an excellent money manager, she even collected enough money to purchase a CD while she was in High School. She manages it very seriously and is saving to get another one by the end of this school year.

Good for you!

My parents were always business owners, so they always had a job for us! When I was thirteen I worked at their restaurant, in college I worked at their day care. We had the same responsibilities as every other employee and if we misbehaved, we were sent home. When we weren't earning that way, we got an allowance only after completing extra chores weekly. We were given 5 extra chores, each paying $1/week, but we could only make the whole five dollars or nothing, so we had to do ALL the chores. I'm sure you can't get away with those sad wages these days. :)

Then my dad took us to open an account. We had $10 that we'd earned. After that, money was put into three categories, 1. Spending money 2. Saving for something money 3. Long term savings.

Spending money was for whatever we wanted, (in my house I emphasize to my kids that they can buy what they want with their money, but I have the right to throw it away if it is inappropriate.) Saving for something money was for larger purchases we wanted to make, like a stereo or a bike, and Long term savings were untouchable funds that helped pay for college.

I'm a financially responsible person -- I have no debt other than my home loan, we even save to buy cars with cash. I credit my folks with teaching me to handle money.

With that said, my brother can't handle money to save his life. He makes an obscene amount of money (4x what we make), but is always broke at the end of the month. So I guess all you can do is your best and hope it all works out.

Good luck!

We recently started a online bank account at Wells Fargo for 4 of my children, age 8, 4, 4, and 18 months. The younger children are not aware of theirs yet. However my 8 year is very well aware of it. Before we had the account he would ask for everything in the store. He earns money by helping with the laundry (he has basic chores like cleaning his bedroom & clearing the table that he doesn't get paid for - but has to be done before he can earn money)and he also collects cans to be recycled. One week he had earned $5 and my husband asked him if he wanted to buy a used game for his playstation2 ($5). To our surprise he stopped to think about it. Then he said he wanted to wait until he had $20 saved up so he could buy the game and have money in his account! We were impressed. Occasionally things like the book fair will come up and he wants to buy all the books until we remind him that he can purchase what he wants with his own money. He also has stopped asking if we can buy a toy or candy, instead he tells us first he has $XX amount and would like to spend it on an item - which quite frankly is getting rarer. It helps him to stop and think. Wells Fargo also has a rewards program to encourage savings - for each day a minimum of $5 was deposited they award points. The points can be redeemed for cool prizes! My son also has fun with their appropriately aged educational site. There is also a virtual world game (stage coach island)for ages 14 and older.

Good Luck in whatever you decide to do!

M. I think a savings account is a wonderful idea. Most banks have online banking too which is a way for them to learn to navigate that system and look at how their money is growing if you opt to be green and not receive paper statements. Depending on the age of your children, some banks/credit unions have the coin saver cards that children can put quarters or dimes in to get up to a certain amount and then go deposit. My girls when they were younger would love to fill that with quarters and they knew when they had reached $10.00 we would be making a trip to the credit union to make a deposit. The staff there always made such a big deal about them coming to save their money that they looked forward to it. Hope it goes well for you and yours.

Hi M.,

As a recently widowed young mom of an adorable 2 year old, I think that the best thing you can do is lead by example. If your examples haven't been the greatest, explain to the older kids what you've done and the steps you're taking to correct them.

I think that its a wonderful thing that your kid wants a savings account! I opened one for my daughter about 6 months ago. I show her how to put her change into her piggy bank and once a month we cash some in and put it into her account.

I found this really cool bank online that is divided into three sections: to save, to spend, to invest. I think it gives children the opportunity to say where their money goes. If you tell them that they have to split their money, they think more wisely about where it goes to.
Good luck!

We got our kids a saving acct when the got money for their First Communion. Our bank offers free online banking so it is easy to track the savings since they do not send statements monthly. It also allows us to easily transfer his allowance money directly in to the SA. My 12yo is required to save 10% of his allowance each week. The rest is for him to save or spend on his own. If it is something they want badly enough, they will save up for it. All my boys bought their own iPods from allowance money.

We have accounts at Wells Fargo for all but the 2 year old with a little seed money and they make deposits when they have something substantial. Check out Dave Ramsey's site. He has some great tips on teaching this to kids.

Our insurance company has a piggy bank that is divided into thirds. 1/3 to share, 1/3 to save and 1/3 to spend. It is great to teach them early to share with others who have less. A friend of ours always matched whatever was earned to teach kids early to be entrepreneurial. I wished I had thought of that! His son now has his own little business at 15! Be sure to show him what compounded interest does over time. (http://www.bygpub.com/finance/InterestCalc.htm has a simple calculator) An 11-year-old might enjoy saving more if he saw what would happen if he saved $1-2 a week for 5, 10 years or more!

oh there are lots of things about this topic i think dave ramsey also has some suggestions. donate 10% ( biblical ) save this % and spend the rest ( bills and entertainment). i was a saver...still am and very cheap! but instill the balance of how much to save...why your saving...and how much is ok to spend and how not to get into debt.

We went through Financial Peace (Dave Ramsey) and there is a component for children. If you have not taken this class, I highly recommend it. Dave Ramsey has a tv show and several books. He started out making lots of money in real estate and then lost all of it and owed money. Through hard work and savings he paid has paid off everything he owned and now has millions. He shares what he has learned from his experience. The class is worth taking even if you are not buried in debt. Financial Peace has a component for children. It involves the children being responsible for chores (no payment), such as taking her plate to the sink after dinner. These are things s/he must do because s/he is part of the family. S/he also has tasks that s/he is paid to do (commissions), such as feed the cat. As s/he grows up, things that were paid for may become regular responsibilities and new tasks receive payments.

Financial Peace works on a cash only system - no borrowing. My daughter (age 5)earns $5 a week - $1 for each task. She must save $2 a week, give $1 away to a church or a charity of her choice, and she may spend $2. We are trying to teach her to save for things she wants (short term), save for tomorrow (long term) and to give to those less fortunate. When we go to the store, she sees all kinds of toys she wants and we talk about how much each item costs. We discuss saving her money. When she has enough, she takes her money and buys the toy by herself. She takes great pride in being able to buy toys herself and give her own money at church.

We also have a savings account for her and ask grandparents, etc to contribute for her birthday instead of gifts. Her birthday closely follows Christmas, so she does not need other toys. In fact, last year we donated all the birthday gifts to a local women's shelter. She did not seem to mind at all.

If your 11 year old is asking for a savings account, that is wonderful. Many banks will allow your child to open an account without fees (even though the balance will be lower and without a direct deposit). There will need to be an adult on the account, too. I do online banking and we use my daughters account to save for college. The nice part is I can have money transfered monthly to her account and never miss it.

Good luck!
Elaine

Does he get an allowance and does he do odd jobs for others for pay? Most savings accounts at banks require a minimum deposit. When he has saved enough for that, or you might give it to him as an incentive, sit down with him and make out a budget. He has to have some spending money for pleasure. Determine how much he should spend and how much he should save and see to it that he sticks to the plan. Some parents make all gifts of money to straight into the bank. I don't like that idea. A gift of money should be spent on a wanted gift. If the child wants to safe all or some of it, OK, but that should be his choice. Try to find a bank that offers an interest bearing account so he can see his money grow.