What will your child be doing with their Communion money?
With first Holy Communion season on the horizon, many children may receive money from family and friends. This offers parents and guardians an opportunity to talk to their children about money and pass on some valuable life skills around managing their own money and making considered financial decisions.
Here are the Competition and Consumer Protection Commission’s top tips for parents.
Set a savings goal
A great way to help your child get started is to teach them how to budget. It is important that children understand why they are saving, so sit down with them and decide on some savings goals. A great way to start is by having three special jars; one for spending, one for saving towards a specific goal, and, one for the future - this is money that is put away and can’t be touched until an agreed time
Every time your child receives money, whether it be pocket money, communion money or birthday money, they can decide how much they would like to put into each jar. Over time your child will begin to understand how to manage money.
Open a savings account
One of the best ways to help children learn about managing their money is to open a savings account. Start by encouraging them to save a portion of their communion money. Banks, credit unions and An Post all offer kids’ savings accounts. If the account has online access or a savings book, you can show your child at any time how their savings are growing.
The key to continuing the savings habit long term is to keep it fun and keep them involved. Many financial institutions offer novel and entertaining characters to help kids learn about money. They may also offer useful online resources which can help to make savings fun and interesting for the kids.
You may find your child losing interest in saving their money or becoming frustrated when they want to buy something straight away without having enough saved. You could encourage them to continue saving by agreeing to match the amount they have saved. Do this for a couple of weeks to help them reach their goal.
Keep it fun!
It is important that children have an understanding about the value of money. Once they have a savings account and begin to save regularly, think about letting them withdraw a sum occasionally for something they have their eye on. A treat as a reward for saving will keep them motivated and help them see the value in saving money.