This post is in response to a topic raised by Ashwini, a member at our MoneyTalk India Finance Forum
(https://moneytalk.enidhi.net) who sought help how to cultivate a habit of saving in her
brother who spends all his pocket money in no time and keeps asking for
more money.
I thought about it a bit and here are some tips I could
think of, which if used effectively can make youngsters understand the
importance of savings.
Try 1: Reward
Promise
to contribute to the savings made by a child – If he/she saves 100 Rs
by end of the month add Rs 100 from your side. This reward should
encourage him to save more.(Downside: The child should not borrow from
elsewhere and show as saving- opening a minor bank account in his name
will be very good idea.]
Try 2: Online financial games:
There
are some free games online using which one can do virtual trading.
Teach him some basics of trading and introduce him to this game-it will
be as good as trading in real market except that profit and loss will
be virtual. Such games will make him understand the value of money and
how markets operate. If he likes the game chances are he will develop a
sense of respect towards money and its value?
Try 3: Mandate book keeping
Insist
that the child should give daily or weekly account of all expenditures.
This will increase accountability and we’ll be able to identify what
expenditures were avoidable, for what there were better alternatives
etc and over a period of time it should be possible to improve the
spending habit of the child.