How to Teach Kids to Save

September 20, 2013 by

We all understand the importance and benefits of saving, but that needs to be communicated and taught to our children. Saving is a form of a delayed gratification. It is discipline, which should be taught from an early age, so that it becomes a habit.

Here are practical tips and tools on how to teach children to save:

1. Have a jar or a piggy bank for the long-term savings. Every time your child has money coming in, put away a portion into the long-term savings before spending the rest. Explain to your child that long-term savings is for things much later on in life such as university education, a car or even a home.

piggy-bank2. When the piggy bank or the jar for the long-term savings starts to overflow, it is time to take your child to the bank and open up a savings account. You can explain to your child that the bank account is like a giant piggy bank where s/he can continue putting away the long-term savings. When it becomes age appropriate, you can also discuss the interest rate the account is earning.

3. Explain that saving simply means that they are paying themselves first out of the money that has come in, and then they pay everyone else by spending the remainder of the money on goods and services. By paying themselves first through saving, they are taking care of themselves and their goals first.

4. Have another jar or piggy bank for short term savings, which are for items like toys and video games that the children would like to buy and need to save up for.  I like to take a picture of the item that my children are saving for and I put it on a chart along with the related information such as how much money it is including the taxes. Every time my children add to short-term savings we update the chart.  I hang the chart at the back of their bedroom door, so that they can see every day how close they are towards their goal. To get a sample chart, please click here.  Short term savings is also a great way for kids to learn discipline and delayed gratification. If an item that they are saving for is extremely expensive and it would take them at least couple of years to save up enough to purchase it, I suggest that you offer to match their savings. That way that they can save quicker and not get discouraged or turned off from savings.


  1. Abderahim

    You can also get them to play bank, make a little carrboadd bank, practice making change, giving loans and so on. Or you could help them make a savings chart and help them keep track of their money. There are so many great things you can do with young kids to teach them to manage and make money regardless of how old they are!Great article!

    • Dinarii

      Thanks Abderahim. Those are great suggestions.

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