Banking for Kids

In order to maximize savings and provide a good learning experience, I subscribe to a three-bank system. J has savings accounts at the National Bank of Mom, our local bank and an online bank.

Bank of Mom

The first stop for savings is the National Bank of Mom. J divides his money between his savings, spending and giving envelopes, and I pay interest monthly on the money in his savings envelope. He gets a statement printed and emailed to him, and he writes the interest in the register, keeping the account balanced. We make note of the increasing amount of interest each month, which will prepare us for a more in-depth conversation about compounding. Right now, our focus is on putting at least 10% of all money into savings and the idea that your money can make money.

Local Bank

Every few months, we take the cash from the savings envelope to our local bank. I think it’s important for him to go to a physical bank and deposit money. (So much happens electronically nowadays, and I think it can be difficult for kids to understand. This is why I pay his interest and allowance in cash, so that he can hold it in his hands and work with it.) The tellers are also very nice to him, which adds to his experience.

When looking for a bank, you might want to start with your own bank, but you could also look at other local banks or credit unions. Also important when choosing a bank:


Practice Makes Perfect

Last month we started talking about percentages in the 10-10-80 savings plan with our focus on the 10% that goes to savings. I want J to save at least 10% of all money he receives, so we’re working on how to calculate 10% of any amount.

I showed him two ways to calculate 10% last time:

  • Use the 100-grid and divide the amount into 10 equal parts. $3.00 divided into 10 equal parts gives you 30 cents in each 10-block
  • Move the decimal one place to the left to find 10%. $3.00 becomes $.300 or 30 cents

J got a calculator for Christmas, so we integrated it into our practice. I showed him how to find the decimal equivalent of a percentage by moving the decimal point two places to the left (10% becomes .10).

Saving Spending

Short-Term Savings Plan

When we first started learning to manage money, we had three envelopes — one for savings, one for spending and one for giving. The savings envelope was for long-term savings — I give J a monthly statement and interest (more on this later). What I didn’t account for, however, was short-term savings — things that he wanted to buy but didn’t immediately have enough money. He’d have to save up.

It was October at the time, and with Christmas coming, we thought it would be perfect to save for Christmas presents.

  • We got a new envelope
  • We made a list of everyone he wanted to buy for, approximately how much he wanted to spend on each person and added to get a total needed
  • We then decided on when he’d like to save the money by (two weeks before Christmas) so that we had time to shop and wrap the presents
  • From there we could calculate how much he had to save per period to meet his goal

In addition to the register, I made a small worksheet that we filled out with the above info.

National Bank of Mom Savings Plan

Getting it together Saving

Our Savings Envelope & Register

Up until about six months ago, when my son J would receive money, we’d put it in an old lemonade jar on his dresser. It would sit there until it filled up, at which point we’d head to the bank to deposit it into his savings account.

All was well, but I had this feeling that I could be using this money to teach him some important lessons.

I did some research and came across the Moonjar. The Moonjar is a jar with three compartments — one for saving, one for spending and one for sharing (or giving). I also found the Money Savvy Pig — a piggy bank with four compartments for saving, spending, donating and investing. And for all the crafters out there, there are a TON (and I mean a TON) of DIY posts on blogs and Pinterest about creating your own jars.

These were good ideas, but the idea of lugging around a jar full of money was absurd. Wouldn’t an envelope or wallet be better? You know, like normal people carry? Plus, even more importantly in my mind, I wanted him to know exactly how much was in each “account” at any given point and learn to balance the accounts. (I am one of two people on the planet who actually balances their checkbook. Actually, I found another! Joan on Man vs. Debt!)

With a plan in place, we embarked on our hunt for envelopes and a register.

Getting it together Hello

Hey there, I’m new here!

First, let me start off by saying that I never wanted to start a blog. I thought that there were enough blogs out there and that mine would just be more noise in a sea of… well, noisiness. But it turns out that I have a few things to say, so even if no one ever reads this, that’s okay because I’m doing it for me. (I’m actually hoping that at least one or two people tune in, though, because maybe I’ll be able to help them. Like you! You there! How I can help you?)

In 2016, I started to get my shit together. The previous few years were some difficult years for me (read: apocalypse of epic proportions), but 2016 was going to be MY YEAR. (I think my cousin told me this. I probably laughed at the time, but thanks, Danya — you were right!)

I started meditating, exercising regularly and stumbled on the concept of financial independence. If you haven’t heard of it, financial independence is where you save money instead of spending it all so that you can get to a point where you don’t have to work. all. the. time. Don’t get me wrong — I like to work. I just also like to do a lot of other things.

So I paid off all my debt (bye bye student loans!) and started a real big-girl emergency fund. At this point, I’m almost fully-funded with six months of living expenses. I’ve been keeping track of my finances daily and monthly and am feeling good about my future.

Thinking more about it, I thought I should probably start to teach my son about money so that he would be in a better place at 37 than I am. I’m fortunate that at 8, he’s a captive audience. He’s also pretty good with addition and subtraction and likes money (and toys. And pizza. And talking. He’s a pretty happy kid overall.)

Which brings me here. We live in such an information-saturated time (I’m looking at you Internet) that there are SO many good ideas to choose from. Have you been on Pinterest lately? Unfortunately, there is also a lot of garbage to sift through. Being a researcher at heart, my plan is to dive in and learn everything I can. Then I’ll surface with all the good stuff and post it here.

So if you have little ones, or just want to get YOUR shit together, stop in. I’ll give you the best of what I find and show you what works for us.

Before I go, I want to note that I’m not about saving every penny at the expense of living today. I don’t want to be miserable right now so that I can be free some day in the future. I also am not for rampant consumerism or working a lot so that I can buy a lot of fancy cars, houses, the latest gadgets and mountains of stuff. You’ll soon learn that I’m not a big fan of stuff. My main goal is to be able to live the life I want to live, with all the good parts — friends, relationships, quality time, personal improvement, creativity — the list is endless.

Whew! If you got this far, thanks for reading. I hope to see you again soon!