Friday, February 25, 2005

Personal finance tip

Gannett News Service

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Want to get your children involved in saving and avoid debt later in life? Here are some places to start from www.practicalmoneyskills.com:

• Draw or cut out a picture of the item for which your child wants to save. Provide a separate bank or envelope for each item for which the child will save money, and make a chart to help track progress.

• Make the day your child opens up his or her first bank account a special day. Put your child in charge of looking at and filing monthly statements. Be sure to look at and discuss how much interest accrues.

• Each time your child makes a deposit in his or her savings account, match it. Then allow your child to withdraw only his or her deposit and hold off on any more deposits on your part until the withdrawn money has been replaced.

• Talk about how the family feels about borrowing money. Talk about whether allowances should be based on chore production or used solely as a way to teach kids about managing money.

• Start a family-spending diary, including treat costs, to show where money goes.