Reasons to Save for Your Children

We all hope that our children will grow up to get good jobs and become fully self-sufficient. But it’s the rare child who can accomplish that without some help in the beginning. One way to ensure that they will have everything they need to get a good start in life is to set up a savings account for them early on. It’s never too soon to do this; you can even start before they are born. The important thing is to set aside money regularly for the sake of the kids so that later, you will be able to help them with major expenses, particularly college.

If you set aside just a small amount of money each month and put it into a savings account, it will accumulate significantly over the years, with interest adding considerable value. Avoid the temptation of using that money for other purposes. One thing you can do is have the money automatically transferred out of your checking account every month. You may almost forget that the savings account for your children is there, and you will be pleasantly surprised when you get a statement. Many banks even offer special accounts with the particular goal of saving for college in mind.

While it’s probably a good idea not to tell your children too much about these accounts, you can get them started on good saving habits early by setting them up with their own account. Give them a regular allowance and teach them the value of socking away money for future use. If they want to buy something, encourage them to save up the money to buy it themselves and offer them the possibility of earning more money by doing extra chores. Most establishments won’t hire children under the age of 16, but you can get them started with fiscal responsibility at a very young age.

College is an expense that becomes more prohibitive with each passing year. Even if you instill a good work ethic in your child, a typical high school job will only be enough to cover a small portion of tuition costs. In most cases, a payment plan can be worked out, but do you really want your child to leave college saddled with tens or even hundreds of thousands of dollars in debt? This happens all too often with the current educational system. Having enough money saved up to cover even a quarter of the cost will be a big help to your children.

It’s important to develop good saving habits early in life. Making sure that you always have enough set aside for a rainy day will spare you many future headaches. But when you develop your saving strategy, make sure to leave some room for the betterment of your children.