While your child may have an interest in putting money aside for the future, or you simply wish to teach them about the benefits of saving their allowance or pocket money, many banks do not offer accounts until your child reaches a certain age. Prior to this, it can sometimes be difficult for a child to know what to do with their money, especially if its presence increases the likelihood of temptation to spend it. By looking into some options available, even for extremely young children, you can help them to meet their savings goals.
If your child wishes to save money for many years to come, or wants to make sure they have funds available to them once they are a fully fledged adult, investment options such as junior ISAs from Wealthify could be a good way forward. These will allow your child to deposit their money into an account that cannot be touched by anyone, including them, and will only become available for their use once they reach a certain age. To help them save some extra money, you could also opt to deposit money into this account, being cautious of any annual limits found in the terms and conditions. Each year, the account will also benefit from tax-free interest, allowing it to keep growing as the years go by.
Using a piggy bank, or other storage container, is another way to help your child save their money, but this time from within the home. Some containers cannot be repeatedly opened, meaning you only have one opportunity to access the money before the item is broken, which can help to encourage greater savings until it is full. Other popular designs also feature security to help prevent siblings or friends from getting into that individual child’s savings, giving them a greater feeling of safety when it comes to putting their money aside.
Some children find it incredibly difficult to save money, or even resist tempting purchases. Here, it could be useful if they know a parent, guardian, or trusted adult can look after the money for them. Rather than making your child save their money with no compromise, it can be a good idea to sit down and talk to them about the benefits of saving, both now and in the future. This can help them to understand why buying everything you want isn’t always a good idea, and also trust that the money they entrust to you will still be available if and when they ask for it back.
Helping your child to reach their savings goals, as well as to promote this behaviour in general, can teach them some of the aspects of good money choices that will become necessary in adulthood. Starting young, it is entirely possible for your children to have good amounts of savings available to them by the time they reach adulthood, which can make broaching independent living that much easier.