It’s Never Too Early: Kids Can Be Financially Fit Too!

By: Raevyn Jones, Marketing Coordinator, NHS of Baltimore

It should come as no surprise to anyone that there are many benefits to saving money at a young age. Children can use this money to save for college, back-up savings for adulthood, or even to buy their first car. Although saving money is not easy, it may be easier to for children to risk the temptations than adults.

With the current state of our economy, many kids are making the decision to save money at a young age. I believe that as soon as children begin to receive allowance, parents should initiate a savings plan. This plan should consist of long term goals and short term goals.

The first step to saving money is setting a savings goal. This goal will determine how much you save every week or bi-weekly when you receive your allowance. An effective way to determine your savings goal is to figure out how much you want to have by a certain date. For example if you want to save at least $300 a year, your savings goal would be roughly $25 per month.

After the savings goal is initiated, parents should open up a savings account for their child. Because of the lower fees credit unions offer, this may be the better option for a child’s savings account. Credit Unions also serve as the better option because the parents must be with the children if they want to withdraw money.

As an alternative to getting an allowance, teens may want to consider other ways to make money. Some of these options may include babysitting, lawn mowing, selling baked goods, shoveling snow, flyer distribution, selling Avon products, or summer positions with organizations like YouthWorks.

A big help to ensure that children will save money is for parents to be role models to their children. Parents may want to sit down with their kids and discuss with them the benefits of saving. For example, statistics on how much quicker a person can buy a house based off the money they save or being able to travel out of the country. Also, taking a financial fitness course with your teenage child could be a big help. This financial fitness class will teach your kids how to manage money while still living on a budget, most importantly the class is free of charge.

Regardless of how old one is, financial fitness will always be an important factor. The earlier children understand this, the better off they will be in the long run. For more information about Financial Fitness courses, please contact Neighborhood Housing Services of Baltimore.