We all set out with the very best of intentions every year to start saving more. But something unexpected always comes up, like the refrigerator that needs to be replaced, a transmission problem, or a hike in your kids' tuition. Many millionaires, in sharing the secrets of their wealth, say they paid themselves first. Learn some tips about paying yourself first and teaching your children to do the same.

Make it fun
How can you make a child want to save his money? Make it fun and gratifying! Here are several ways to do so:

  1. Find just the right "piggy" bank, and let him help you pick it out. There are some really cute ones that have internal machines that pull the money in or make a "cha ching" sound when the money disappears. And others fit a theme that children like; for example, a beloved cartoon character.
  2. When your child receives a sum of money, offer to match the amount he saves, or increase the match incrementally by the percentage of the total that he is willing to save. In other words, say your son gets $5 for bringing in a neighbor's garbage cans while they're out of town. If he saves a dollar, you'll match him a dollar. If he saves $2, you'll match him $1.50. If he saves the whole thing, you'll give him half again or $2.50.

    Obviously, this can't be a permanent arrangement, but it might be fun to do this periodically if you're trying to teach a lesson. Children often have a hard time conceptualizing where the money goes when they are saving it. It seems lost, or as if he'll never see it again. Making it appealing or gratifying will help!

  3. Let your child be the one to complete the transaction at the bank. Stand behind your child in the bank, and allow him to go up and speak to the teller. Depending on the age of your child, this may not be a big deal; perhaps he's already doing this. If not, what a way to let him do a "grown-up" thing!
  4. If family members wish to give gifts of money, but your child is stubborn about saving, you might encourage those family members to give savings bonds as gifts instead. Your child won't really understand much about it now, but later the gift will mean something and have more value, both financially and sentimentally.

Most importantly, your child doesn't need to know your net worth, but he will most certainly benefit from hearing your candid discussions on the topic. Perhaps you might show your appreciation of a great deal you see advertised, or tell him about a bargain you got recently. Let him know how much you saved, and how those savings will benefit you down the road! Just don't be afraid to talk about money -- your children will thank you later.

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