Tips for Teaching Your Child Good Saving Habits

April 9, 2024 by Partner Colorado Credit Union

April is National Financial Literacy Month. It’s a good time to highlight the importance of financial education and teaching financial responsibility to the younger generation. Every parent wants to raise their child to be financially responsible, and helping your child learn how to save money is one of the most important first steps. Teaching good financial habits early on will help your child be better equipped to handle financial decisions as he grows up. Here are some tips to guide you in giving your child good saving habits.

Start Early

Introduce the concept of saving as soon as your child is old enough to understand basic money concepts. Even toddlers and preschoolers can grasp the idea of setting aside money for later. With toddlers, start out by playing something as simple as the waiting game. Set a time and tell your child if he can wait quietly for three minutes, he’ll get a treat. This will teach him delayed gratification and help him understand that sometimes, he has to wait and save up for things he wants instead of buying them right away. You can teach your preschooler the names and values of coins. This will help him learn more about money and its value, which is another essential financial skill.

Use Clear Jars or Piggy Banks

Give your child a visual representation of his savings by using clear jars or piggy banks. This allows him to see his money grow over time, which can be very motivating. Your child will get a free piggy bank when he opens a new Lil’ Partners account.

Set a Good Example

Children often mimic their parents' behavior, so be a positive role model when it comes to saving. Let your child see you save money for various goals, whether it's a vacation, a new car, or retirement. Make sure your child sees how long it takes to reach the goal, and what budget cuts were made to achieve it. Set Savings Goals Help your child set specific savings goals for himself, such as saving for a toy, a game, or a special outing. Break down larger goals into smaller, more achievable ones to keep him motivated.

Offer Incentives

Consider offering incentives to encourage saving, such as matching a portion of what he saves or providing extra privileges or rewards when he reaches certain milestones.

If your child is old enough, you might consider giving an allowance. It’s a great financial teaching tool. When parents give their child an allowance, it helps him learn how to manage his own money and control his spending. If you want, you can have your child do simple chores around the house to earn the allowance. That way your child learns money is earned, not just given.

Make Saving Fun

Saving money doesn't have to be boring. Turn it into a game by having savings challenges or competitions within the family. You could also create a savings chart or use stickers to track progress.

Discuss Wants vs. Needs

Help your child understand the difference between a want, like a video game or toy, and a need, like food and shelter. Encourage him to think critically about whether something is necessary or just something he desires. This will teach him how to prioritize his spending and saving.

Involve Your Child in Financial Decisions

As your child gets older, involve him in family financial discussions and decisions. This could include budgeting for a family vacation or comparing prices when shopping for groceries.

Teach Smart Spending Habits

In addition to saving, teach kids the importance of smart spending habits, like comparison shopping, looking for deals, and avoiding impulse purchases.

Discuss Financial

Topics As your child grows older, gradually introduce more complex financial topics, such as budgeting, investing, and the power of earning interest. Tailor these discussions to your child’s age and level of understanding.

Encourage Generosity

Teach your kid the value of giving by encouraging him to donate a portion of his savings to charity or to help someone in need. This helps instill empathy and compassion while also reinforcing the importance of sharing and generosity.

Be Patient and Supportive

Learning to manage money takes time, so be patient with your child as he navigates the ups and downs of saving. Offer support and guidance along the way, and celebrate his efforts and achievements, no matter how small.

Open a Savings Account

As your credit union, we’re here to make saving fun for kids of all ages. Get your child started by opening a youth savings accounts. This will give your child a sense of ownership over his money and allows him to earn interest on his savings.

Our Lil’ Partners account is designed for kids 12 and younger. We have quarterly coloring contests with cash prizes and your child gets a free toy with every deposit. Our Teen Partners account is for kids ages 13-17. When your teen opens a Teen Partners account, he gets the opportunity to earn a $25 cash deposit just by passing our online education module.* We’ll even make the first $20 deposit whenever you open a new youth account.

By following these tips and incorporating them into your daily routine, you can help set your child on the path to financial success and independence. Remember, the lessons your child learns about saving now will serve him well throughout his life.


*One $25.00 bonus deposit per member. Must complete and pass the Teens and Money BalanceTrack module and exam with a score of 80% or better to receive the $25.00 bonus deposited into account. Bonus is paid out for completing the module and exam one time. Must have a savings and checking account with Partner Colorado Credit Union to receive the bonus.