6 reasons kids should have a savings account

It’s never too early for kids to learn how to save money. Savings accounts teach kids responsibility and help build funds for the future.

  1. Savings accounts teach children the importance of spending money.
    1. Children have many opportunities to spend money, but it can be difficult for them to understand that spending money means having less of it to save.
  2. Many kids savings accounts offer free financial literacy resources.
    1. It's never too early for children to become financially literate. When children learn how to balance personal finances at a young age, they're less likely to develop unhealthy spending habits as college students or young adults.
  3. Savings accounts are secure places to keep children’s money.
    1. Cash from birthday presents, generous relatives and the tooth fairy can accumulate over time. Once the money gets deposited in a banking account, the child can't withdraw it without a parent or guardian's permission. Keeping money in a savings account prevents kids from spending their money unnecessarily and eliminates the possibility of theft.
  4. Savings accounts generate interest.
    1. The earlier a parent, grandparent or guardian opens a savings account for a child, the more interest the account will generate from the principal. With interest, children can see for themselves how they can earn additional funds simply by keeping money in their savings account.
  5. Children can learn how bank accounts work.
    1. With a parent's supervision, children can learn how to use their credit union's online interface or mobile app to manage and monitor their savings accounts. This experience instills a sense of financial independence in children that can help them handle their finances confidently as adults.
  6. Children learn how to set goals.
    1. Rather than buying expensive electronics or toys for your children when they ask, parents can use the savings account to explain what it would take for their children to save the money themselves. They can learn to set savings goals and envision their future.

Once they are old enough, opening up a checking account can also be beneficial for those with first time jobs. We offer youth checking accounts with many awesome features such as no monthly fee and no minimum balance.

For more information visit Youth Checking - With This Account Your Experience Will be a… | DECU

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