Money Talks, So Should You

Q&A: How can I teach my child to save and budget?

Mechel Glass
by Mechel Glass, Dimespring Contributor  (@CredAbility)

My daughter just celebrated her 9th birthday. At her birthday party, instead of giving presents, just about everyone gave her money as a gift. Her instant cash infusion gave me a perfect opportunity to teach her how to save money and set goals for future purchases.

After the party, we discussed where to start her savings account. Like most children, she is adept at finding information online, so we considered starting an online bank account.

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But the more I thought about it, I wanted her to see and understand how a bank works — how to deposit cash, receive a receipt with her balance and learn about other services offered by a bank. So we went to our local credit union to open an account.

We set up a time to visit the office and opened a joint account. After all, she is only 9, so I want to have control over her funds. But I also used the visit to give her some incentives and set some rules.

To encourage her to save, I’ve agreed to contribute $5 to her account for every $10 she deposits. It’s important to give any child an incentive to save at a young age; I want to shape her habits and attitudes about saving now. As we know, when she becomes a pre-teen and a teenager, she will see how other teens spend money on clothes and other personal items. I want her to enjoy her money, but I also want to make certain she knows the value of saving.

Next, I set rules about withdrawing her money. She can only withdraw money for items that she needs. I won’t let her spend money on “wants,” such as video games. And her first request met my requirements. There is a book fair coming to school this week and she asked to withdraw $10 to buy a book. I agreed and she got to witness how to withdraw money.

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So far, I have accomplished three important goals: my daughter has a savings account; I’ve set up a match for future deposits and established rules for withdrawals. In addition, she now understands that if she wants to purchase any item in the future, she needs to plan ahead. It’s a great way to teach her that she will need to set aside money for future needs  and that’s what budgeting is all about.

The new bank account has solved another mystery, too. Before her birthday party, my daughter wanted to make certain that no one else could ever get to her money  so she hid her money in the guest room mattress and would occasionally move it to other rooms all over the house. Now I know all her favorite hiding places.


Mechel Glass is vice president of community outreach for CredAbility. She is responsible for coordinating community outreach and financial education activities across the agency’s regions and developing new education programs for both classroom settings and online. Glass, a U.S. Army veteran, is also co-author of “The Veteran’s Money Book,” scheduled for publication in April 2014 by Career Press. The book can now be ordered on