Blog

In today’s fast-paced world, teaching your kids about money management and financial literacy is more vital than ever!

So, start teaching your kids crucial lessons about money. The early development of money skills will equip your kids with practical knowledge to make smart decisions when they become adults. 

For example, you can start by setting up investment apps for minors so your kids can learn about how to use their money wisely by investing in stocks and shares. Invstr Jr is a great example of one of these apps. There are many ways you can start encouraging your kids to learn about financial literacy; we will explore this throughout this article.  

What Are the Piggy Bank Principles, and How Can They Help You Grow Your Wealth?

The piggy bank principles can be used to teach kids about money management and instill good financial habits from an early age. These principles are simple and easy to follow, and kids can apply them daily.

These are the piggy bank principles:  

• Save for the future: start by teaching your kids to save money for the future. When they get their weekly or daily allowance, encourage them to save money for their future needs and goals.
• Spend wisely: Teach your kids about the concept of reasonable spending. Help them understand the difference between wants and needs. 
• Share and give: Teaching your kids to share and give money is also an important part of their lessons about money. You can allocate a few coins your kids can give to charity organizations monthly or weekly.
• Set goals: Encourage your kids to set short- and long-term goals, whether it’s saving for a new toy or gadget. Setting goals helps them understand the concept of delayed gratification and the rewards associated with saving money.
• Track and monitor: Teach your kids to check and track their spending. Whether it is writing it down or recording it on a spreadsheet, make sure they understand that keeping a record of these things is important. 
• Delayed gratification: You can explain to your kids the meaning of delayed gratification, which means waiting and saving for something they want instead of spending impulsively. This will teach your kids to develop patience and discipline, and money management. 
• Work and earn: Teach your kids the value of hard work and earning money. Encourage them to take on jobs and tasks to earn an allowance. This principle will help children to understand that money is earned through effort and cannot be taken for granted. 

Each of these principles will teach kids to manage their finances well. In addition, financially savvy children will learn to make smart decisions with their money, leading to generational wealth.   

Why is Saving Money Important, and How Can Piggy Bank Principles Help?

Saving money will allow your kids to gain financial security, achieve their financial goals and learn to invest their money wisely – and build generational wealth. The piggy bank principles will ensure that your kids learn how to save their money and focus on reaching their financial goals.

So how can your kids learn to use the piggy bank principles to save money effectively? This takes us to our next point. 

What Are the Key Strategies to Save Effectively Using Piggy Bank Principles?

There are many ways to save effectively using the piggy bank principles. For example, 

• Make saving a ritual: Every month, when your kids get their allowance, encourage them to keep a large chunk of it in a savings account.
• Gradually increase your savings: As your kids learn to save money regularly, encourage them to save more over time. 
• Count your savings regularly: Motivate your kids to continue saving by counting the money they have in their accounts. This will encourage them to keep on saving, especially if they know they are closer to reaching their goal. 

How Can Kids Set Financial Goals and Achieve Them with Piggy Bank Principles?

When your kids follow the piggy bank principles, they will learn to define their savings goal by creating a plan and sticking to it. 

For example, if your child wants to buy a new toy – write it down and show them how much it costs. Then encourage them to save some of their pocket money to buy the toy. Every week you can sit with them and then count how much they have saved and work out how much they need to be able to buy the toy. Once they reach their saving goal, go with them to the shop and buy the toy. They will feel a sense of accomplishment when they reach their saving goal. This is the first step in showing your child that saving money to reach a goal is a good accomplishment. 

What Are the Benefits of Consistency and Discipline in Saving Money?

There are many advantages your kids can gain from being consistent in their efforts to save money.

For example,  

• Improved financial habits: When you consistently save money, you will gain positive financial habits. 
• Peace of mind: You will rest easy knowing that your debt is paid off and you have money in the bank saved for a rainy day. 
• Generational wealth: When you consistently save money, you can invest wisely over many years and use compounding interest and returns to build generational wealth. Your kids can also start investing early and learn from the best investing apps for minors.

How Can Piggy Bank Principles Help in Teaching Kids about Delayed Gratification?

The piggy bank method encourages kids to exercise self-control and patience by focusing on saving to reach their long- and short-term goals. It also teaches kids to feel accomplished when they reach their saving goals. 

Conclusion

In closing, empowering children with money skills extends beyond simply teaching them how to count coins or manage an allowance. It involves fostering a holistic understanding of the value of money, the importance of making informed choices, and the ability to set and work towards financial goals. By instilling these skills, you can give them a sense of control and independence, preparing them for the economic challenges and opportunities they will face as adults.

Featured Image by Oleksandr Pidvalnyi from Pixabay