Children should Learn to Save as Early as Possible
Children need to start learning early about saving money and one of the best ways for them to do that is with a children' savings account. Savings accounts for children are a perfect way to teach children about banking and to get them to understand the importance of saving money.
Lessons for Life
A children's savings account starts by teaching kids the basics. They learn about making deposits and withdrawals, interest, and how a bank works. Watching their account grow through regular deposits will teach them the importance of saving over the long term. Basics such as balancing a bank book and figuring simple interest are things that will serve them well throughout their lives and hopefully give them the hunger to learn more.
Don't forget to teach your children about banking's most important feature, security. Explain to them how their money is insured up to $250,000 by the government and that if the bank is robbed, their money will still be safe. Instilling this type of confidence in the banking system at an early age will likely lead to children who are more willing to invest.
The next thing children need to learn is the difference between money that is invested and money that is liquid. Explain to them that they can remove money from their savings account whenever they want, but if they have their money invested in bonds, they have to wait for the bond to mature to get the best return. Also explain how compound interest works to grow your money more rapidly. This helps children understand the importance of letting their money grow.
With so many of today's college aged kids in debt, it is important to start teaching younger kids about banking and personal finance as soon as possible to avoid this situation. Children's savings accounts are a great way to get kids involved and give them a concrete, real world lesson on the importance of money.
Lessons for Life
A children's savings account starts by teaching kids the basics. They learn about making deposits and withdrawals, interest, and how a bank works. Watching their account grow through regular deposits will teach them the importance of saving over the long term. Basics such as balancing a bank book and figuring simple interest are things that will serve them well throughout their lives and hopefully give them the hunger to learn more.
Don't forget to teach your children about banking's most important feature, security. Explain to them how their money is insured up to $250,000 by the government and that if the bank is robbed, their money will still be safe. Instilling this type of confidence in the banking system at an early age will likely lead to children who are more willing to invest.
The next thing children need to learn is the difference between money that is invested and money that is liquid. Explain to them that they can remove money from their savings account whenever they want, but if they have their money invested in bonds, they have to wait for the bond to mature to get the best return. Also explain how compound interest works to grow your money more rapidly. This helps children understand the importance of letting their money grow.
With so many of today's college aged kids in debt, it is important to start teaching younger kids about banking and personal finance as soon as possible to avoid this situation. Children's savings accounts are a great way to get kids involved and give them a concrete, real world lesson on the importance of money.
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