Teaching fiscal responsibility to children needs to begin at an early age. Nobody wants to live their adult life always struggling to make ends meet from paycheck to paycheck. Learning money management skills takes time, practice, and a development of self-control and prioritizing. These skills are not born into humans, they must be cultivated until they become ingrained habits. In the increasingly instant gratification world and lure of online everything, parents need to set and reinforce high fiscal standards in their children beginning with their first piggy bank.
Starting a savings account in your child’s name not only gives you hope for their future, but it also improves the social-emotional health of your child, according to a new study. NeuroNetLearning explains recent study results.
The findings, published in the Journal of American Medical Association Pediatrics, reveal how accumulating monetary assets within a household positively affects a family’s outlook on their child’s future, despite the household income. In fact, researchers believe it’s even more important for families with lower incomes to start a savings account in their child’s name.
When parents hold a dedicated account of accumulated assets for a child – however small or large that might be – it can directly shape the child’s development through parents’ behavior, health and involvement.
To test the possible effects a savings account has on a child’s development, 1358 families received $1,000 for their child’s savings account which could only be used for children’s postsecondary education. Parents also answered questions regarding their child’s social-emotional development at 4-years-old. The questions were based on three specific areas of development: self-regulation, compliance and interaction with people.
A control group (those without a savings account) of 1346 families was also used for comparison.
The results showed that children who had a savings account scored higher in the development areas than children whose parents did not have a savings account. The researchers believe that accumulating assets within a household positively affects the family’s outlook on the child’s future. This in turn affects parents’ attitudes and interactions with their child.
So, whether it’s a savings account or a piggy bank, parents who begin saving early for their child might be investing in more than just their child’s future, but also their social and emotional well-being.