When I turned seven, Father Christmas gave me a piggy bank. I had no idea what I was supposed to do with it and when I asked Mommy why Santa had given me porcelain pig with a hole in its back, she said, “That is where the money goes in”. She explained to me that if I collected enough coins, eventually the piggy bank would be full and then I would be able to buy something that I liked.
It took many months for my piggy bank to get full. I would pick up five-cent coins I found all over the house, on the road, in shopping malls, until one day not another single coin could fit in without sticking out.
“Now what?” I asked my mom.
“Now, we smash it open and you’ll get all the coins you’ve saved up.”
I didn’t want to break my piggy-bank. It had given me joy for months as I felt it get heavier and heavier and I’d grown particularly fond of its incentives. I decided not to break it and the following Christmas I woke up to another piggy bank from Father Christmas. This time it was plastic and underneath it was a plug-like cap that I could open and close when I wanted to take the money out, which I did, often.
The second piggy bank had little to no success. Money would come out of it faster than it went in.
A few months later, our house was burgled and both piggy banks were stolen, but that’s another story.
Read more: Do your kids know how much you earn?
When I turned 16 our grandparents opened a savings account for my brother and me, each with R200 in, which we were told to leave so that it could grow and earn interest. The problem with our bank accounts (and the problem with our poor money-saving skills) was that when we turned 18, we had access to the funds. Over the two years the R200 had grown a little bit and it wasn’t long before we had spent it all.
If I had kept that money in there, I’d probably have a nice little savings to use towards a deposit on a car or to put towards future travels.
In later years, I opened a long-term savings account. If I wanted to I could access it after submitting a request to access the funds, but at 30 years old I’ve finally realised how important it is to save rather than spend at that the more you save, the more you earn.
The more you save the more you earn
It’s never too early to start saving money. Teaching your kids the value of money and how to save, rather than spend unnecessarily, is something they will only thank you for later on in life when they are no longer financially dependent on you.
Some parents begin teaching their kids the importance of saving from as early as the toddler years, by using a point system or by using ‘coupons’, which the child can collect (save) to earn a reward.
Using the jar or envelope method can be a fun way for your children to learn the importance of earning something by saving. Get your child to draw a few different pictures of what they’d like to buy with their savings, and stick each picture on each individual jar or envelope.
Set an example
Let your child learn to save the way you do. Openly demonstrate how you put money towards something you want. Keep a money jar somewhere visible so that your child can see you putting money in. Explain to him/her what you’re saving for and once you’ve saved enough money, make a big deal about buying what you’ve saved up for.
There are many ways to teach your kids how to save and spend wisely, but the best way to influence a child's financial responsibility is by setting example and guiding them in the right direction.
How do you teach your kids to save money?