Get Kids Started on the Right Financial Path
By Erica Wennell, My Gut Instinct Board Member
We often hear that our children are our greatest asset, the door to the future. How can we help them build confidence in their financial future?
One good answer is a credit union savings account. By encouraging regular savings at Sun Federal CU, you prepare your kids to meet the demands of an increasingly complex financial world. A regular savings program helps both teenagers and younger children understand the basics of personal finance and the importance of building sound money management habits. It demonstrates the power of savings to help youngsters reach their goals. It prepares them for the day when they’ll manage their own money.
Even very young children can grasp the fundamentals of saving, and become excited about having their very own savings program. As they grow and acquire allowances, after-school jobs, and other income sources, children can see those savings add up–and their pride and independence grow, too.
Perhaps the most important reason to start saving early and regularly is that saving helps young people develop the skills they’ll need to be intelligent credit consumers. A record of regular savings tells the credit union this young person can handle the responsibility of repaying that first loan for a car, college, or educational travel.
Having demonstrated the ability to stick to a planned program, loan officers are more likely to approve the loan application. In this situation, the share savings account does double duty, because the young borrower–lacking any credit history–can use it as security for the loan.
So don’t wait. Help your children open share savings accounts and encourage them to add to them each week or month.
Remember, it’s not the amount of the deposit that counts: It’s establishing sound, lifelong financial habits that will make more complex financial transactions later on easier, and more comfortable. Start your kids on the road to confident money management and financial health!
