Posted on April 02, 2019 by Jake Ward, CMSE – VP of Marketing
April is National Credit Union Youth Month! There isn't a better time to talk to your kids about money, encourage them to save, and open them a youth savings account
if you haven't already!
I've had the privilege to talk to students of all ages about money, cash, cheddar...you get it. The biggest takeaway is that a lot of kids are left in the dark in terms of some basic financial concepts. I am shocked by the number of teenagers who have not had a bank account or know if they have one. They are within a few years of leaving home without understanding the most basic concepts such as interest, dividends, ATM fees, etc.
Opening your child a savings account at a young age can set them up on a path for future success when it comes to their finances. I'm not saying your child needs to learn how 401(k)'s work, the difference between a certificate of deposit vs. a bond, or how compound interest works before they graduate high school. What I'm saying is that teaching your children the importance of saving their money for things they need or things that are really important to them will help them down the road when they have to make these decisions for themselves.
Here are my 3 reasons you need to open a youth savings account for your child, and get them actively involved with saving and budgeting now!
1. It Introduces the Saving Habit Early
Saving is essential for financial security. It builds a foundation so that when unexpected expenses come up you don't have to borrow money or max out credit cards. Did you know the typical payday loan amount is just $300 to $400? Teaching your kids to save can make a huge difference in their life experience. And if you really want to encourage your child to save, consider matching the money they saved from doing chores, their job, etc. and help their savings grow even faster. Our Kids Are Rewarded for Saving
account tracks your child's saving and rewards them with prizes along the way. It's a great way to get your kids excited to save!
2. It Gets Them Thinking About Money
Taking your child to deposit money, helping them track their saving, and going over what they can do with their money is instilling financial responsibility. When you're at the store, talk to your kids about needs vs. wants. There is a cost to both and including your children in those discussions shows them that sometimes wants should be put on the back burner until enough money is saved up.
3. It's a First Step in Their Financial Future
Your child won't learn everything they need to know from a savings account. They will learn the importance of saving, how a financial institution works, and that things they want cost money. If your child is older or if they're still a few years away from their first job, consider getting them a checking account so they learn how a debit card works. Our myCA$H
accounts are designed for teenagers and rewards them with CA$H incentives for saving and learning how to use our services. Having these basic money principals at a young age is a step in the right direction for future financial success.
At the very least, consider including your children on some of your monthly budget items. You don't have to include them on all of your expenses, but groceries is usually a good place to start. Go over your monthly grocery budget with them and when you're in the store look at the cost of goods with your child while you buy. This is a great way to teach them the importance of budgeting and that just because they want you to buy 5 gallons of ice cream, it's not in the grocery budget.
Stop by our branches this month and your child can win prizes, money, or even an Apple Watch during April! Check out why NOW is the perfect time to open your child a savings account, or get them into the branch to save money! Learn More about Youth Month!