$plitting kid’s money between different accounts is a solid life skill that can be taught at a young age as practice makes habit.

Financial Tip Friday is brought to you in partnership with the 1st National Bank of Dennison. 

After the candles are blown out and birthday cards are opened, a kiddo can accumulate a small stash of cash or checks.  Where should that money all go?

From about age 5 on, parents may be able to begin teaching their children about savings.  This can be done in an easy manner (but you’ll need to prepare beforehand with having materials and change).

Splitting Money

Money can be split into 3 categories easy for children to understand.

• • Spending (for small toys or ice cream treats)
  • Savings (for a long term goal ie. vacation, college, car)
  • Giving (tithing to a church, donating to a local charity, PTO/booster school fund)

Materials Needed

• • Smaller coins and bills to divide the money into smaller amounts
  • Markers and paper to create your own money tracker/ledger
  • Zip-lock baggies, yogurt cartons or to go plastic containers with lids

Home Banks

• Allow child to decorate 3 separate “banks” with stickers or markers
• Label each bank for spending, saving, and giving
• Write down the amount of money that is in each and every time you add or take away money, add it to the ledger.

Open Children’s Saving Account

• When about $10 is saved in the “Savings” home bank, consider opening a kid’s club bank account at a local bank.  First National Bank of Dennison has 2 Kid’s Clubs:
  • • H.A.M.M.Y. Club (Happy About Managing Money Youth) for ages birth-12
    • F.I.T. Club (Financially Independent Teen) for ages 13-17

These kid’s clubs typically have no minimum balance nor service charge and they will collect compounding interest each quarter.

Use it!

Actually letting children spend money in their spending and reminding them about what they are saving for is important.  This is the follow-through of setting up the habit of saving and spending.  $plitting kid’s money with them each time they receive a gift or have a lemonade stand sale will allow for future stability in life.

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