How Can A Pig Teach A Kid About Money?
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It's important to teach your kids about saving and investing money at an early age. It can be as simple as a piggy bank.
By: Jasper Smith
What if every child grew up and knew how to properly manage their money? It would be nice if that was the case, but the sad thing is most children don’t have this skill because their parent’s parents never taught them. Without action or intervention, the trend continues generation after generation. When does the trend stop? Just like when any other trend is stopped, someone or something decides to change the game, thus creating a new trend.
I think it would be wonderful if every parent in the world had in their possession a piggy bank that broke down money into four categories: Spending, Donating, Investing and Saving. I don’t think I need to go into detail about spending because that’s what everyone knows how to do. But let’s take a closer look at the other three components of this piggy bank.
Donating is a remarkable and fulfilling thing to do because it shows that you care about something other than yourself. That, in itself, is a great quality for kids to carry with them throughout life.
Investing helps a child learn about stocks, bonds, mutual funds – and most importantly – about developing a long-time financial strategy.
Saving, a concept that even adults struggle with, teaches a child to be disciplined about having money for rainy days, emergencies and shorter-term purchases like a new video game. The rule of thumb is to have an emergency fund with enough money to cover basic living expenses for about 3-6 months. Since no one has a crystal ball to predict the future, a healthy savings account can help people prepare for the unexpected.
At Northwestern Mutual, many financial representatives provide four-slot piggy banks – affectionately named Penny the Pig – to clients who have kids. As another option, some parents are providing kids with four clear containers – one for each money management concept.
No matter what container you choose, the important thing is for parents to begin a long-term conversation about money with kids in a comfortable and practical way.

