Four actions to encourage the saving of your children
Children are children and, as such, they should play and be happy without too much worry. However, they are also sponges that absorb everything that happens around them, which gives us an excellent opportunity to instill basic knowledge about finances that will help them when they are a bit older. We recommend that you put into practice these four actions with which to encourage the saving of your children, because although they are still small, everything they learn already, will come in handy in the future.
Keys to encourage savings in the smallest
- Pay yourself first. It is proven that the people who save the most are those who, just after receiving their salary income, allocate part of it to savings . In other words, before paying the mortgage, the credit cards or the purchase of the supermarket, they pay themselves first. This is the main habit that we should instill in our children to encourage savings. If they already receive a small weekly pay, let’s teach them to pay themselves first by keeping a small part of the income in the piggy bank. If they practice pre-saving from a young age, they will make it a habit and they will continue doing it when they are adults.
- Learn to manage your expenses. All families have fixed expenses, such as mortgage, and variables, such as those derived from leisure. It is essential to know how to differentiate one from the other. While the fixed costs are fixed, with the variables there is always room for reduction. Most people do not know how their money is spent because they do not know how to differentiate between their different expenses. From small, children must learn to manage their small expenses. If they receive a payment of 5 euros and 2 euros prepay, what do they spend the remaining 3 euros?
- Consume responsibly We live in a materialistic and consumerist society. People only think about buying things to be happier with . However, most of the purchases they make only contribute to increasing their poverty instead of their happiness. This happens because they do not practice responsible consumption.
Young children are a clear example of compulsive consumers. They see something and they want it at once. Not tomorrow or in ten minutes, they want it now. You have to know how to take advantage of these moments to teach them how to consume responsibly . If since we are children we give them all the whims, they will continue to have whims when they are adults and will not have that ‘culture’ of encouraging savings.
- Debt is expensive. Bank loans are the order of the day, to the point that many people prefer to borrow money instead of saving . No one stops to think that behind that advertising banner in which they invite you to change cars for only 180 euros per month, you hide the payment of 7-8% interest, in addition to important opening or management fees.
Children have to be shown with simple examples that getting into debt is expensive and not without risks . It is no longer just about explaining that the debt is bad, because not everything is, but they understand the risks of it. It is always preferable to save first and buy later instead of borrowing to make the purchase.
What do you think of these tips to encourage savings among children? Do you already apply any of them?