Managing money is a foundational life skill. There are so many factors involved and so many open-ended questions at play. How much should you be saving? When is it worth spending more? How do you keep spare change from burning a hole in your pocket? It takes years of discipline and training to perfect this skill, and ongoing self-control to maintain it.
That’s why it’s best to give your kids a head start on money management and saving. As a parent or guardian, remember that the lessons you plant today will take root and blossom, enriching your child’s life for years to come.
Section 705 is proud to offer specialized youth savings accounts that are designed just for kids. We know that different ages and stages have different needs. That’s why we offer Youth Accounts for children aged 0-17, as well as Teen Club Accounts for teens aged 13-17.
Our youth savings accounts offer (no annual fees and quarterly dividends) to help you teach your child that saving money always pays. Another perk that comes with having a 705 savings for your child is our Learn 2 Earn program. Bring your child’s report card to the credit union when they make honor roll or have perfect attendance. They get to choose a gift card to places like Barnes N Noble, The Grand, iTunes, Target, and Toys R Us! Plus, their name gets entered into a drawing to win $150 at the end of the school year.
Ready to open an account for your child? Does your child already have one? Read on for three steps to take for ensuring your child gets the most out of a new or existing account:
1.) Set a goal
Now that your child’s money will be sitting in an account instead of a piggy bank, let her use this opportunity to save up for something big. Sit down with her and discuss what she’d like to save for. You can create a long-term goal, like saving up for college or for a first car. Also establish a short-term goal, like a new gaming console.
Set a date for your goals, and then set up a savings calendar for illustrating how much money needs to be saved each month to reach the intended target by the designated date. Discuss ways to add to the savings, being sure to include money from birthday gifts, summer jobs, allowances and chores.
2.) Bank together
Whether your child is a first-grader or a lanky teenager, if this is their first time owning an account, they’ll need you to show them the ropes.
Always bring your young child along with you when you stop by the credit union to deposit his savings. Show him how it works and let him see the account balance growing. If your child asks you to withdraw money from his account, make sure he sees how this translates into a dip for his savings.
For teens, you’ll need to walk them through that first deposit and withdrawal. When they’ve probably got the hang of it, it’s time to take a step back and let them be on their own. They’ll feel like a million dollars managing their account independently.
However, share with your teen that every swipe of their debit card also means a dent in their account balance. Also be sure to warn kids of all ages about security. They should know to never share their account information with anyone, and to keep their debit card in a safe place.
3.) Monitor your child’s activity
Don’t aim to be a helicopter parent, but do keep an eye on your child’s account. If he’s depositing a lot less than planned, ask him where his money is going. If your teen is maximizing his daily ATM allowance, speak to him about money management and impulse purchases.
Your teen’s daily withdrawal limit may need occasional adjustment, so keep a careful watch on spending to see if any modifications are needed.
Remember: Every financial lesson you teach your child today equips them with money management skills for a lifetime.