Money Smarts Blog

Imagine being a kid again; always listening (well, sometimes), watching, learning from the people around you. They’re like tiny, sticky little sponges, and they soak in way more than we give them credit for ¾ including the way we talk about and use money in our daily lives.

Research shows children as young as 3 can grasp basic money concepts (not to mention it’s super cute to buy an imaginary cup of coffee from a toddler using Monopoly money). And the Consumer Financial Protection Bureau says kids are developmentally capable of saving by the age of 5. What does this mean?

It’s never too early to start teaching your child about money!

As we transition into a cozy new season, let’s talk about some ways to help the kids or teens in your life “fall” into good savings habits (get it?).

Like adults, kids learn about things in different ways. Money conversations don’t have to be a chore ¾ incorporate bite-sized tips into activities you’re already doing together. For example, a trip to the grocery store can be a lesson on how your family budget relates to shopping. Dog sitting for the neighbor is a teachable moment on the value of hard work and earning money for the things you want. And since kids naturally like to help, the holiday season can be a good time to talk to kids about giving to others and being part of something bigger than themselves.

One of the best ways to give your child or teen real-world money experience is to help them open their very own youth savings account. IHMVCU’s Balance Builder Junior Savers was designed specifically for youth under the age of 18. Although you can open the account online (more on that below), it’s a good idea to visit a branch together so your kiddo becomes familiar with physical banking transactions. Plus, making their first deposit can be a fun learning experience! For most, the transition from piggy bank to an account is a big deal, and seeing their excitement is part of what I love about my job.

Once you’ve opened your child’s savings account, it’s time to set some age-appropriate savings goals. For younger kids, that could be the latest video game, toy or stuffed animal, while teens might be eyeing concert tickets or a phone. Giving them something to look forward to might help keep them motivated (kind of like sticking with your workout routine when you have a beach vacation coming up). Depending on their age and/or goals, you could also consider matching your child’s savings or offering a bonus dollar amount once they reach a certain money milestone.

Speaking of tracking, make it fun for them! Seeing is believing, so have some kind of visual representation of your child’s savings progress to help inspire them. Younger kids might do well with a savings chart on their bedroom wall (a quick Google search turns up dozens of printable options). Teens can check in on their progress through an easy-to-use app. No matter how you do it, tracking is key to savings success.

At the end of the day, making sure your child has a solid financial foundation is just as important as setting them up for educational success. Yes, kids are still going to go through a mac-and-cheese-only phase. They’re still going to leave all their clothes wrong-side-out when they put them in the laundry ¾ no matter what age they are. And they’re still going to respond with “nothing” when you ask what they learned in school today. But by starting money-related conversations early, you can feel good knowing you’re giving them a smarter start to a brighter future ¾ and IHMVCU will be there with them every step of the way.