PCRI Aims to Teach Children to Save

April 1, 2014 · by pcriadmin · Featured, PCRI

PCRI knows how important having good money management skills is to successfully navigating life. We want our children to grow up to be responsible with money … but how soon should we start teaching money management skills to our children?

Recent studies indicate that if we wait until children become teenagers, it might be too late to be most effective teaching these skills. According to a report by researchers at the University of Cambridge commissioned by the United Kingdom’s Money Advice Service, kids’ money habits are formed by age 7.

Chidren-and-savingsParents need to help children develop saving habits at an early age before they develop spending habits. Beth Kobliner, a member of the President’s Advisory Council on Financial Capability, says children as young as three years old can grasp financial concepts like saving and spending.

As they get older, parents can help children distinguish between what we can and cannot live without. Understanding the difference between needs and wants is the first step in learning how to develop a budget. In addition to being able to navigate personal finances, financial education leads to other benefits. Teaching kids to save teaches self-control. Choosing to save, instead of spend, is an exercise in self-control. The famous 1927 Stanford Marshmallow Experiment showed that kids with self-control are psychologically better adjusted, more dependable and do better in school.

Kids who save are also more likely to go to college and graduate. The July, 2013 Biannual Report from the Assets and Education Initiative (AEDI) found that even with less than $500 in college savings, children from families with modest means are three times more likely to enroll in college and four times more likely to graduate than those without college savings. Children with a savings account also have lower stress and a greater sense of hope for the future, according to the Saving for Education Entrepreneurship and Downpayment (SEED) Initiative.TCTS Logo

So what if your children are older than age 7? Should we just give up? No. Parents can attest to how quickly children, even teenagers, can pick up new skills. That is why PCRI is participating in the national Teach Children to Save Program.

On Thursday, April 10th, a free children’s financial education workshop will be held at the Park Terrace Community Center. The workshop begins at 4:00 p.m. and we invite all PCRI residents to bring their children. If you would like to sign up your children for the workshop or if you have any questions, please contact Amy Dang, Financial Education Specialist.

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