subject: The Choice Between A Bank And Personalized Piggy Banks For Children [print this page] As a parent of young children, one of the most important lessons of life that you want to teach them is the art of saving money. This is important when you are explaining to them how money fits into their lives. You have a choice between taking them to the bank to open a savings account in their name, and showing them how that works, and buying children piggy banks for them. You can then show them how to put money on a regular basis into the piggies and watch it accumulate to achieve the desired amount. How do you make that choice?
Start Them Off on Piggy Banks
For younger kids, it would be better not to open a savings account for them right away because they might not understand how it all works. Buy them piggy banks for babies or kids and show them the differences between coins and notes. Teach them how they all add up together to reach a certain amount and how valuable each one is. This helps when you are explaining the concept of saving and how this will meet a future need. As they grow older and more confident in their financial understanding, you can then introduce them to bank savings accounts.
Open a Childrens Savings Account for Them
The physical act of having your kids present at the bank when you open a savings account for them is important. It allows them an opportunity to see for themselves how bank transactions are conducted and to assume ownership and responsibility for their account. It is important that they are involved in every transaction involving that account because it is theirs, and it will give them a sense of independence and say over what happens.
This will afford them a good foundation for making future financial plans in regard to how they save for specific purposes and how they spend their money. These lessons go a long way in preparing them for adulthood when they will be required to make financial decisions all the time on their own. Also, when they see how their money grows on the interest accrued, they will feel encouraged to continue saving even more money.
Ultimately, rather than see the piggy bank and a savings account as two different concepts of saving money, they could actually work in tandem. You could teach your kids to save those coins or bills that you give them for pocket money or as earnings for chores, and once the piggy bank cannot take any more, take the money down to the bank and deposit it into the account. This way, the two do not have to be used exclusively.
