Savings jars are a simple and effective tool to teach your kids about money management and saving. They are physical containers that are used to visually represent money for different purposes. Here’s how they work:
Start by setting up different jars for different purposes. You could have jars labeled for Savings, Spending, and Charity.
When your child receives money, such as a weekly allowance, help them allocate this into the different jars. If they decide to save a portion of their money, they can put it into the “Savings” jar. If they want to spend some of it, they can put it into the “Spending” jar, and if they want to donate a portion to charity, they can put it into the “Charity” jar.
One way to determine how much allowance to give to your kids is to use a standard guideline of paying them $1 for each year of their age, per week. For example, a 5-year-old would be given $5 every week, a 6-year-old would be given $6 every week, etc.
Please encourage your child to track their progress by visually seeing the money accumulated in each jar. This can help them understand the concept of saving towards a goal and see the tangible results of their efforts.
Use the savings jars as an opportunity to discuss financial decisions with your child and to reinforce positive saving habits.
Encourage your child to regularly contribute to their savings jar and celebrate progress towards their goals. You could offer incentives, such as matching their savings or a reward for reaching a milestone.
Learning to save for a goal instead of spending impulsively, it teaches them the value of patience and self-control, which are important financial skills.
Savings jars can be a fun and interactive way to teach your kids about money management, goal setting, and the importance of saving. It allows them to physically see and manage their money, which can help them develop good money habits that can benefit them throughout their lives.
