Make saving a fun experience for your child
Most parents in Singapore know the importance of teaching their children to save for a rainy day. Doing this will help them inculcate the value of money as they are growing up.
Young children may not realise that their parents need to manage money wisely to pay for their daily expenses.
Learning the value of money will come in handy when children grow older and start a family of their own.
The savings challenge
Many parents find it difficult to help their children appreciate the value of saving.
I applaud Mr Lee’s methods of teaching Caleb as there are several benefits. Firstly, by giving Caleb a weekly allowance, Mr Lee entrusts him with the responsibility of budgeting his weekly allowance.
Secondly, having Caleb place his allowance into three money jars teaches him to divide his “income” to meet various needs. The division of his “income” into jars also introduces Caleb to the concept of spending limits within each category.
Topping up Caleb’s savings jar also helps him understand and enjoy the effects of compound interest.
Instead of calculating amounts on a piece of paper, Caleb sees how his allowance is divided and learns to budget his money in a fun way.
Patience pays off
At POSB, we aim to provide parents with tools to help them teach the value of saving to their children.
We reintroduced the savings stamps as the “act” of physically setting aside money best represented saving.
By using the money in his savings jar to buy savings stamps, Caleb is slowly being introduced to the idea of delayed gratification.
By patiently saving and filling up his stamp card, Caleb is able to enjoy a greater reward — an additional S$1 for each completed card.
Differentiating Needs
While Caleb has a Spending jar, Mr Lee still teaches his son to spend wisely by encouraging him to buy items that are more beneficial, such as books, instead of toys and snacks.
Using a variety of methods can help make teaching your children to save a fun experience and give them important skills that will help them when they grow up.
We look forward to working with you so we can continue to build a nation of savers.
