Teaching kids about how to manage money is more important than ever in a consumer-focused world that’s designed to get people to part with their money. It’s no secret that the habits kids pick up while they are young will extend into adolescence and, eventually, adulthood.
At the end of term four last year, I got an email from my boy’s Primary School, letting me know that “Student banking with CBA will be ceasing.” And like many other schools that are ditching the ‘Dollarmite’ program in 2019, they are doing so without a replacement program to put in its place.
We’ve never used the school banking program with our kids and have always had the successful DIY model we shared with many of our clients. This works with all banks and relies on splitting two bank accounts for your kids.
The second account is for their savings – and this is where you have the option to put the money they receive for Birthdays and Christmas gifts. It’s also for when they are “saving up for…” say, a bike, or game, or fabulous shoes. Please don’t link a debit card to this account, so there is no temptation to spend it. We’ve found this also reinforces the habit of parking savings away.
If you like this concept, all you need to do as a next step is ask your Bank/Credit Union about their best Spending/Savings accounts for kids that offer fee-free options and a high-interest rate on both types of accounts.
And if you want more help, check out a video we created on teaching your kids how to save –