It’s back to school time again and excitement is in the air for students and parents. Whether the kids are starting kindergarten, heading off to college, or somewhere in between, for many of us, this means long lists of school supplies, new clothes, new backpacks, and a drained wallet.
Nevertheless, it’s a great time to discuss money with your kids. Like the holiday season or birthdays, it’s important for them to understand the value of a dollar and putting some away for a rainy day or saving for something special. When they’re young, take them to the bank and open a savings account for them. Allow them to spend a certain percentage from monetary gifts or their allowance and have them save the rest in their bank account. Allocating a certain amount to go towards savings, regardless of their age, is a great way to get them in the habit of saving. Show them each month how much they’ve saved and how great they are doing.
Make a game out of shopping for the best bargain on school supplies. First, take inventory of what they have from the prior school year and if it’s in good condition, use it. Next, compare prices online or at the different stores and show them how much will be saved if they choose the best price. Also, don’t buy what you don’t need.
The college-bound graduate will need to stick to a budget. There are several free phone apps that track expenses to help them stay within their means. If they are sharing a room or apartment, splitting the costs of utilities or food will need to be arranged. Awareness of the amount of electricity, gas, and water used will help keep costs down—things they didn’t need to think about at home. If they are in a dorm, have them keep a tally on how much they spend on food and outside dining. Encourage them to use up all their dining points before year-end.
There are many teachable moments throughout their youth. When money is involved, look at the situation and see how you may relay the experience into an informative example. You may think they aren’t listening, but they are. It’s important to educate our children on the power of saving.
You may recall the old tongue twister “Sally sells seashells by the seashore…” and how difficult it was to say it fast or more than three times. Teaching the concept of saving to our children is one of those challenging tasks, which led me to think of this take on Sally sells seashells:
Scrupulous Sally practiced saving. She didn’t snivel nor sigh. She sacrificed and scrimped until her retirement day arrived. Now Sally sits and smiles satisfactorily sailing smoothly and slickly through the Sea…of life.
Michele Sarna is a financial advisor at Beacon Pointe and can be reached at (760) 932.0930.
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