April is a busy month for financial matters. On April 17, your taxes are due. And one week later, on April 24, comes a lesser‑known but still significant event: National Teach Children to Save Day. It’s just one day, but it’s a great opportunity to start getting your young children–or grandchildren–in the habit of making smart decisions regarding money matters. 

National Teach Children to Save Day was established to help teach students about the importance of budgeting, saving and investing. On April 24, financial‑services professionals across the country make presentations to children in grades K‑12, but you may ultimately be your child’s (or grandchild’s) most important financial education resource.

So, what can you do to help a child become a good saver and an informed investor? Here are a few suggestions:

·                      “Jar” your children into saving. If you give young children an allowance, have them divide it into four glass jars, labeled “investing,” “saving,” “sharing” and “spending.” When the “saving” jar gets filled, open a basic savings account for your child–and show him or her how the balance rises over time. Have your child use the “sharing” jar to support some type of charitable cause. As for the “spending” jar, your child will know just what to do with it. Keep in mind that the allowance doesn’t have to be divided equally among the three jars. For older children who can earn money by baby‑sitting or mowing lawns, you might want to start a fourth jar labeled “investing” and eventually use the earnings to open a traditional or a Roth IRA for them.

·                      Reward children’s efforts. Consider partially “matching” your children’s deposits into their savings accounts. If you put in a quarter or fifty cents for every dollar they deposit, their savings will have an opportunity to grow faster and they may feel encouraged to want to save more.

·                      Set attainable goals. Kids will be more motivated to save money if they can see themselves achieving goals. So, when they are young, have them use their savings account for things like toys, video games, CDs, etc. When they are older, you can transition into longer‑term savings goals, such as college.

·                      Make investing fun. When your children or grandchildren are a little older, you can begin to teach them about investing. And you’ll likely have more success if you make it fun. So, for example, have a child pick and follow a stock of a company whose name is familiar to young people, such as Coca‑Cola, Walt Disney or Nike. Every couple of days, record the stock price with your child or grandchild. You could even give him or her a make‑believe “share” of this stock–perhaps represented by a “certificate” you create on your computer– and add or subtract value to it as the share price moves up or down. Explain that a stock’s price is largely determined by how many people want to own it. Also, look for any piece of news–new products, industry developments, and such–that may have affected the prices of your child’s chosen stocks. Try to explain these events in a language your child can understand.

National Teach Children To Save Day comes just once a year, but you can use it to start teaching lessons that will last a lifetime.