A Parents’ Guide to Maximizing Your Child’s Savings Account
Your child’s first savings account is a key tool in building positive money relationships early. Month to month and year by year, you and your child can watch their money grow. Their youth savings account also provides their first chance to practice the idea of “paying yourself first“, another building block of a strong financial foundation.
Here are four ways to maximize your child’s savings account:
1. Engage Them In Banking Basics
Getting your child involved in their savings account is a great opportunity to share the basics about money and personal finance. From learning how to make deposits and withdrawals to receiving their monthly statements and watching their money grow through the magic of compound interest, there are fundamental elements to building an understanding of banking within their youth savings account.
2. Create Good Savings Habits
While studies show that it can take months for adults to develop a good habit, children are much quicker to pick up on new things. Teaching and instilling saving early will not only give your child a jumpstart in developing this healthy money skill, but utilizing their savings account regularly also allows them to visualize the benefits of this habit at work. Is there something they are saving up for, like an upcoming family trip? Giving a name to their savings goal can help motivate them to keep tucking some extra funds away.
3. Build Healthy Financial Relationships
Becoming a member of the credit union is more than just a transaction. For a child, their savings account can be the gateway to building a lasting financial relationship. At Call Federal, we’re here to provide your kids with the tools they’ll need at each stage of their lives. From earning dividends to build their own wealth, to scholarships to help with their continuing education, and financial wellness resources via our Money & Beyond Jr. program, our aim is to guide them to a healthy financial future.
4. Empower Them By Asking Questions
When you engage them on savings and personal finances, empower them by having them elaborate on their plans for their money. What are you saving for? How much does that cost? Is that the best price? How much would you need to save each week to have enough in 6 months? Encouraging them to make wise decisions on their savings goals and celebrating when they achieve them will develop independence and a positive relationship with money that they can build upon throughout their adolescence.
Your child’s youth savings account can be a powerful tool in developing a basic understanding of money and banking, the starting point for a bright financial future. When you are active and involved in helping them maximize their account and credit union membership, you establish a strong foundation which they can build upon from now into adolescence and beyond. To learn more, visit our Youth Savings product page. Ready to get started? Stop by any Call Federal location today to open your account.
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