COLLEGE STATION A recent survey by Zillions magazine found that kids are spending more money on snacks than any thing else about $5 a week on drinks, candy, chips, cookies and other foods.
An economist with Texas A&M University suggests that parents encourage children to manage their money so that their spending habits affect their lifetime financial well being.
“When young people are given money upon request or as an allowance, they will likely think it is meant for spending, unless they get some coaching. Parents should talk about choices they have about spending, saving and sharing money,” advises Dr. Lynn White, family economics specialist with the Texas Agricultural Extension Service.
Zillions found that school vending machines are a major point of purchase for today’s youth. If kids save 50 cents each day instead of dropping it into the coin slot, how much could they would save by the time they graduate?
White suggests using this formula: 50 cents multiplied by 180 school days multiplied by the number of years they have until high school graduation.
For example, by saving 50 cents a day, a third-grader would save $900 by graduation. That amount does not include interest.
“And it’s never too late to start saving,” adds White. “A ninth-grader would save $360. A senior could save almost $100.”
Parents can also consider matching their savings as a reward incentive.
“Savings could be even more if you teach them how to choose a savings account where their money can earn interest,” says White. “I also think children should be given opportunities to learn about consumer decision making and money management.”
The Texas 4-H program offers the Consumer Critter Crew project to children in grades third through fifth. Consumer Life Skills and Consumer Decision Making programs are designed for youth in grades sixth through twelfth. High School Financial Planning is another program available from the Texas Agricultural Extension Service in cooperation with the National Endowment for Financial Education. It is designed to sharpen the skills of high school-aged youth.
“Think about this,” suggests White. “Children who save $28 a week in an investment that earns an average of 9 percent a year from age 20 to age 65 could retire a millionaire. The secret is to teach children to start early and save regularly and to ask themselves every time they use money, ‘What are my choices?’ ”
Each choice a child makes builds or reduces their financial well being now and over a lifetime. For more information, contact your county extension agent.
-30-