If You're Teaching Your Teen To Save Money, Here's an Easy (& Profitable!) Way To Start
With the new year in full swing, my husband and I have started our annual savings plan with our son. Teaching him to respect money is one of many morals we have tried to instill as he prepares to head away for college in the fall. But it hasn’t been easy. Even with our best efforts, he — like many young people — is ill-equipped for the financial responsibilities of the real world, especially with a busy social life and a mom and dad who are constantly footing the bills.
According to a Bank of America Better Money Habits survey, “46% of Gen Zers (ages 18 – 27) rely on financial assistance from parents and family. Additionally, 52% of those surveyed said they don’t make enough money to live the life they want and cite the cost of living as a top barrier to financial success. Many said they are delaying milestones and are not on track to buy a home (50%), save for retirement (46%), or start investing (40%) within the next five years — even though they are working toward those goals.”
There are many ways to save and plans to help people meet their financial goals. One effective one we’ve done is the 52-Week Money Savings Challenge. “Teaching kids, particularly teens, about money is crucial because many will begin jobs and earn paychecks,” says René Nourse, Founder of Urban Wealth Management in El Segundo, California. “Understanding the proper steps for saving money, not just in their pocket and at home, but at a bank is critical to improving their future financial lives.”
Whether saving for a dream vacation, a down payment for a home, an emergency fund, or college, money saving challenges can help you stockpile cash. We’ve contributed to one family pot and challenged other families to join us in past years, but this year, we’ve upped the ante by saving with individual kitties. How much you decide to save depends on your goals and comfort level.
So, if you’re ready to get your money right — and help your kid do the same — read on for savings plans that will have you and your family richer by this time next year.
The 52-Week Money Saving Challenge
The 52-Week Money Saving Challenge is a popular one that begins the first week of the year, hence the name (but it’s never too late in the year to start saving!). In Week One, you will save just $1. During the second week, set aside $2. In week three, stash away $3 up to $52 in week 52. If you are flush with cash now, consider doing the Reverse 52-Week Money Saving Challenge by stashing away $52 in the first week, $51 in week two, and so on until Week 52, when you will save $1. Some may feel it is easier to decrease weekly contributions, especially if income is inconsistent or cash gets low as the year progresses. Regardless of the method, you will be $1,378 richer by year’s end.
The Bi-Weekly Money Saving Challenge
Are you paid every two weeks? If so, the Bi-Weekly Money Saving Challenge (also called the 26-Week Money Saving Challenge), might suit your lifestyle best. With this one, the savings are in set increments over 26 biweekly pay periods. Rocket Money, a website that empowers people to live their best financial lives, explains the challenge this way: “Let’s say you start with $5. Every 2 weeks, you’ll save an additional $5. So, in the first week, save $5. In the second week, save $10, and so on, increasing the amount you save by $5 until you reach week 26.” At the end of the challenge, you will have saved $1,755. If higher stakes are what you’re after, every two weeks save $193, and you will have $5,018 by year’s end — or put away $385 bi-weekly and $10,010 will be in your hands.
The Kids’ 52-Week Money Saving Challenge
It isn’t just teens who can learn valuable lessons about money — who says younger kids can’t get in on the action, too? Nourse recommends parents begin to teach their children about money at about the age of 10. “Kids tend to be more actively engaged and want to know more as they shop with their parents, attend events, and travel,” she tells SheKnows. Modeling money behaviors you want to instill is an excellent way to get kids excited about saving. Start with as little as $0.25 the first week, $0.50 in Week 2, $0.75 in Week three, and so on. Adding one quarter to each week’s savings will yield $344.50. (For a printable Kids’ 52-Week Money Savings Challenge chart, click here.)
Stash Your Cash
Whether you choose to deposit weekly (or biweekly) contributions into a savings account, a coffee canister, a glass jar, or a piggy bank, consistency is key. That may mean a weekly cell phone reminder notification on a specific day or time, a visual reminder in a high-traffic area of your home, or family members holding each other accountable. (For a printable and customizable 52-Week Money Savings Challenge chart, click here.)
Don’t Give Up
Saving money isn’t easy; it takes diligence. If you miss a contribution, don’t quit, just double (or triple) up the next week if you can and keep going. And if you should fall short midway through the year due to an unexpected financial hardship, still count what you have saved as an accomplishment — and try it again. Something is better than nothing, after all!
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