What You Should Teach Kids So They Save Money | Personal Finance

By WilliamBlake
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Word Count: 471

When your child's piggy bank or other money collecting device gets full, it may be time to open an account at the bank. A bank account allows children to keep track of money they have saved more easily. Here are some types of savings accounts that parents may want to consider.

A savings account can be started as soon as a child has money to put in one. Choose a day when you both have some free time and make a trip to your local branch of the bank. Talk to a teller or bank associate about starting an account for your child.

Together, you can open a statement savings account. Statement savings accounts give you a monthly report of all activity. You will be able to see all deposits that your child has made, and any withdrawals that you have made together as well.

You should look over each statement carefully with your child, and explain all aspects of it to them. Show them the amount they started with, interest they accrued, the final amount, and any other activity. If your statement shows the withdrawals without the description, you can write the details on the statement to help the child track how they are spending their money.

You might also be able to get a passbook savings account. Each account holder is given a small "passbook", and the book is run through a machine which records all of your transactions. Your child can find out their balance right away, rather than waiting for a statement. Kids tend to like this, as they can look at their current transactions and balance whenever they want.

Aside from bank accounts, you can also go to a credit union to get a savings account. They offer accounts for children of their members, which are designed for children of different ages. When they get an account, they may also get an ATM card (with or without their photo on it) and other gifts for starting an account.

An ATM/debit card can be used as cash by your child for their purchases. Parents can keep the receipts and teach children how to check them against their savings account statements each month. Allowance money can also be deposited in the savings account each month.

For children under eighteen, some states will offer what is called a "custodial savings account". This type of account states the parent's name as the account holder, with child's name under it. When the child turns eighteen, ownership of the account can then be transferred to the child (now young adult).

Children can keep track of their money much easier with the use of ATM/debit cards. You should greatly consider opening a savings account for your child, as they are a great tool for teaching them how to save and track and manage their money.

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