I believe this is a very likely question in the mind of parents of most pre-schoolers. They just can’t understand how a small child can fathom the concept of saving. Saving is easier to understand when it is followed with goal setting on what the money is to be used for. No wonder Steven Covey says “Begin with the end in mind”. Some of these goals can be short-term while some are long-term. Short term goals are what your pre-schooler can understand. They will not be able to save for bigger things and longer periods just yet especially because their memory is still very short and they can only identify with what they see from time to time.

When a pre-schooler wants something, he or she finds it very difficult to wait. This is, however, a valuable lesson they need to learn. In order to achieve this you need to discuss with your child. Real life situations in which your child has to wait for something like waiting for the holiday to start, waiting for the holiday to be over, taking turns at home and at school, standing in line, waiting for his or her turn in the park or playground, etc. can be used to drive home the point about waiting until you have enough money saved for something.

If your child really wants anything but does not have enough money to buy it, explain that he or she can save their money in a safe place, such as a piggy bank until he or she has saved enough to pay for the item. Help him or her create a mini-budget for the purchase by asking the following questions:
• How much does the item cost?
• How much does he or she have saved already?
• How does he or she plan to make money?
• How long does he or she think it will take to save up the amount required?

Help your child put all this in writing as seeing it from time to time will be very helpful and motivational. As much as possible do not step in to help your child pay for the item if helping was not part of the goal from the beginning. Not only can this set you up for a lifetime of bailouts, but it also diminishes your child’s efforts and any feelings of accomplishment he or she could have by reaching the goal on his or her own. It’s okay to propose ways by which he or she can make the money; just avoid the handouts.

The art of saving, which also promotes delayed gratification, can also help children forget about some of their wants. Many children, for example, fall in love with a particular toy and decide they have to get it. Over time, however, they may decide that toy is not so important after all. Waiting to make a purchase is an excellent way to avoiding impulse buying and is an effective tool for helping kids determine what they really want and what they can do without. This same principle works for older kids, teens and adults as well.

– Gbonjubola Sanni