How to Help Your Child Develop Lifelong Saving Habits

Habits, good or bad, form early and are hard to break. One of the best habits we as parents can help our children develop is one of regular saving. Make it fun and make it routine if you want to make it happen.

1. Decide together how much should be saved

The percentage of how much she saves from gifts, jobs, or her allowance will vary from job to job, gift to gift, and year to year, but it's important to establish it in advance of getting the money.

2. Taking it off the top

Kids, like adults, postpone saving and find themselves without anything to save at the end of a time period. So help your child tuck money into savings first - before she does anything else.

3. Set target dates for a specific goal

If a child is saving for a video game accessory, suggest she find a picture of it and mark it with the date on which she hopes to purchase it. Have her keep her eye on the goal by tacking the picture up on the refrigerator door with a magnet pinning it up on her bedroom door.

4. Encourage a coin roundup

Kids who feel they're too old for piggy banks can drop their loose change into a jar or dish instead of leaving it in their jeans pockets to be lost in the washing process. Once every few weeks, persuade them to roll up the coins in heavy paper coin rolls available from the bank. They'll be amazed at how much money can be made from collecting change, when it's done in a systematic way.

5. If your child shows signs of becoming a collector, encourage him to take good care of all he amasses, for it well might be an investment

Many avid young collectors of baseball cards, Olympic paraphernalia, stuffed animals, comic books, rocks, and more have realized a profit years later from their collections. Talk to your child about what constitutes value in a collection: condition of the collectibles and rarity. It's important to remember that saving really can be equated to amassing of value, whether it's money or something else.

6. Share some trick-yourself-into-saving techniques that you've picked up over the years

Put a portion of an allowance away each week, or saving all earnings from holiday gift, or tackling extra household chores.

7. Encourage your child to make his own decisions when it comes to saving...

...even if that's not how you would do it or what you would save for. The merchandise she finally buys or the activities she uses the money for is not as important as the fact that she's taking charge of her own life, and engaging in the saving process.