All parents want their children to excel in every sphere of life. In order to achieve this, they support them in whatever manner possible.
Beginning early is key to every success. Like for example those of who want their wards to be doctors, engineers begin them with coaching classes as early as class nine to prepare for the entrance exams. For those who are good in sports, start training in their respective discipline to improve their skills and strive to be the best in the competition.
But rarely have I seen children being prepared to take financial decisions early in their lives. There could be several reasons for this, like for instance some would think, as the children lack maturity they could be incapable to take financial decisions so early in their lives, others think that children should not be burdened with money matters as that could adversely affect their normal upbringing. So much so that even the education system which decides the subjects as well as the matter to be taken up in schools doesn’t have any emphasis on financial subjects.
Students first exposure to subjects like financial management or economics begins mostly after passing their matriculation levels, which is why the awareness levels of most parents as well as students regarding careers in finance is restricted to banking or CA.
Today’s article relates to the small beginning we can make in our children’s lives towards their financial preparedness, and how it can build a foundation of sound investment decisions they would be making later in their lives. Thanks to the RBI (Reserve Bank of India), you could introduce your child to the financial system as and when they turn 10 by opening a savings account. Opening a savings account for your kids offers them a peek into how banks and financial system works, additionally it gives your kids a place to stack up their allowances and birthday money. Instilling habit of savings is a valuable lesson which requires time. Once you put money into your kid’s savings account, you can teach them how to do basic banking chores. There are several benefits attached with opening savings accounts for your kids. Here I have listed some of those benefits:
Imparting Financial Education:
Money is such a subject that most of us avoid it totally. You might find it taxing to discuss about, maybe you think it’s rude to discuss it or perhaps it doesn’t occur to you to talk to your child about money. You might have several reasons not to converse about money and with this cashless economy approach for handling everyday finances, there isn’t much opportunity. With a savings account for your child, you also bring an opportunity for discussion regarding money; how to earn it, how to use it, and how to save it.
Imparting habit of savings
By opening a savings account for your kid, you encourage your kids to start saving money regularly, teaching them an essential skill they would have for life. Inculcating a habit of putting aside a part of your allowances and understanding that you to need to wait to buy something that imparts money management skills to your kids. Moreover, children as young as 3-year-old appreciate the concepts of saving, sharing and spending. Recent research shows that having a savings account to save for kids could create benefits for them later in life too.
Inculcating responsibility
The feeling of being responsible for your own money will make your kids a good guardian of their money into their adulthood. Having a savings account of their own would make them more responsible and can make them more sensitive towards money as grown-ups.
Finally
What is the real value of money? We have all heard the expression that money does not grow on trees but for children, it’s just a funny phrase which their parents say sporadically. By getting your child a savings account where they could deposit their money, your kids would start learning about the value of money. Money is a tool. Used properly it makes something beautiful; used wrong, it makes a mess.
