Teach Children to Save

Saving, Spending, and Sharing - Washington Trust, the nation's oldest community bank, has a long tradition of teaching children about money. As part of the bank's ongoing Financial Literacy Program, employees visit elementary schools to teach students fundamental money management strategies. Here are a few discussion points to use with your children or grandchildren to help raise a super-saver:

Set Savings Goals

Help your children or grandchildren value the idea of working toward a goal. Discuss different ways that young people can earn or get money - odd jobs, babysitting, birthdays, etc. and help them set a savings goal and plan how long it will take to reach it. Whether it's a video game or a piece of designer clothing that they just have to have, they'll see how with hard work and patience, money can add up and they can buy the things they want if they just have patience. When they experience first hand how hard they've worked to earn their money, they might not be as quick to want to spend it on just anything.

Discuss “wants” vs. “needs”

Teach children the concept of saving money so they will have it when they need or want something. Help them distinguish between wants and needs - they may want the newest video game, but they need food and clothing. When they understand the difference, they might stop and think about whether or not they really need that item at the supermarket checkout.

Create a Sharing Bucket

Try this exercise with your children: Instruct children to put their money into three buckets: saving, spending, and sharing. They'll save a little, have a little to buy the things they want, and will be able to “give a little back”. Having a sharing bucket presents children with the concept of philanthropy, and raises questions that can be discussed at home with their parents: How much money should they put in? Who should the money be given to? How should it be given?

For more tips on raising a money smart child, visit these sites:

Washington Trust Cherry Tree Kids' Savings Club
Kids Savings Gamers & Calculators
The FDIC
The US MINT
The US Treasury