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Nine golden rules to get the kids saving

Jul 10, 2008

  1. Savings account – open up a small account for them and get them to put the birthday money into it. Teach them the benefits of interest and that “money can make money”. They can each earn up to $2,667 pa before the taxman wants to tax them at 46.5%.
  2. Pocket money – it doesn’t need to be much. You just need to start getting them to learn about spending, saving and being responsible with money.
  3. Help set some savings goals – motivate them to want to save for a future purpose. Sometimes it’s good to get them involved in your own savings goals (eg house, car) so they can learn first hand from you.
  4. Give extra opportunities to earn money – if they really want that bike or iPod give them the chance to do extra chores around the place to save. Teaches them the value of hard work.
  5. Take them shopping – most parents think that this is the worst thing to do but it can actually be a great educational tool for them to see you shop around for bargains. Get them involved and ask them to look at the prices of items.
  6. Savings chart – get them to chart how much they are saving each week and help them visualize the benefits of saving.
  7. Let them “fall off the bike” – kids need to get the important lesson of losing money so that they appreciate it more in the future. Better to learn at a young age than later in life.
  8. Show them the household budget – show what bills are being paid and their cost and what money is coming in to pay for the bills. It helps give them a better idea of money management.
  9. Simply say no – when they put on a performance at the shops when they want something tell them that have to wait, save up and shop around before they can get it. Gets them out of the habit of ‘impulse purchases’.

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