Personal Saving For Kids Essay Research Paper

Personal Saving For Kids Essay, Research Paper

Personal Saving For Children

Money takes on a new meaning when there are children in the family. Parents realize the added pressure on the family’s income to cover more wants and needs. They also feel and express a concern for helping their children develop healthy, positive attitudes about money.

Attitudes and habits about money are learned at an early age. Very young children begin to learn about money by observing how their parents feel about money and react to it. They notice whether parents argue or discuss calmly how money is to be spent who pays the bills, and who keeps the records. This role as observer while still a child will be a subtle but significant influence on how a person feels about money through life.

How can parents teach their children so money will be a positive factor in their adult lives. Some ideas and suggestions include:

Set a Good Example

Actions speak louder than words in forming attitudes about money. So set a good example. Is money used in the family by parents as a bribe, reward or means of control. Are material goods craved. Is there an effort to keep up with the Joneses. Is more emphasis placed on the cost of a gift than the feeling of giving it. Since children are masters at spotting inconsistencies when parents say one thing and do another, be sure to practice what is preached.

Use every opportunity possible to teach smart buymanship. Help children learn to read labels, to ask clerks questions when they do not find information they need on labels, and to recognize a good buy. Take them with you when you shop. Explain why you choose to buy one item over another. Then offer guidance and suggestions when children are doing their own shopping, but remember, the final decisions are theirs when they are spending their money.

Set a good example in the use of credit. Credit involves responsibility as well as privileges, so be sure to pay debts promptly. Because credit is a necessary part of living in society, avoid making children afraid of it. If children have to borrow from their parents to meet unexpected expenses, set up a definite repayment schedule to give them some practical experience in using credit.

Put Them “In the Know”

A recent study indicated that there is much less fighting about money in families where financial matters are openly discussed. Help children develop a general understanding about the family’s financial picture by allowing them to know the source of the family’s income and a general “ballpark” amount figure. Most children don’t want all the details of their family finances but they need to know the family, as a family, is secure. After all, family stability is probably the most important fact in their lives.

Answering your children’s questions about the family’s finances may be a lot like answering their questions about sex: answer the questions but don’t repeat the whole book when a simple sentence or two will do the job. Ask yourself what is it they really want to know; then answer that question, but don’t burden them with details they can’t understand.

Family Financial Councils

Let children sit in on family discussions and decisions about how to spend the family’s income. By doing this, they’ll develop a much better understanding of what the family’s expenses are. Such discussion can help children also to see that their wants and needs are only part of what the family’s income must cover. When they begin to see the total picture, they may be more willing to cooperate with family economy moves such as making clothes do for another year, taking care of furniture, and turning down the thermostats.

A family financial council gives everyone in the family a chance to express their ideas and wishes. Children can be asked for their opinions and can help in gathering information before the family makes a decision about a big-ticket item like a new car or television set. Older children can be involved even more by helping keep family records, check writing and discussions about the family’s insurance program.

A Regular Allowance

When children are old enough to tell the difference between coins and when they begin to ask for money of their own, that’s the time to begin a regular allowance. Probably most children will be able to handle an allowance by age 5 or 6 but perhaps even earlier if they have older brothers and sisters already receiving allowances.

Parents and children should decide together just what the allowance covers. The amount should cover their needs and include a little extra so that not every penny is spoken for before they get it. That little extra will be what they use to practice decision-making. Do they spend it on this thing or that — or do they save their allowance for something even bigger. If all of the allowance is spoken for, children have little opportunity to practice making choices.

The amount should be a fair share as it fits into the family’s total spending pattern. Also consider what their friends receive as an allowance. An amount smaller or larger than what peers receive will cause problems for your child. Remember that the cost of living for children increases as they get older; renegotiate their allowance “contract” occasionally.

At first, pay the allowance once or twice a week d

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