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Back to School 2016

Elementary through college: What to save at every age


 
You’re probably in the thick of buying school supplies and fall wardrobes, but have you thought about your finances this back-to-school season?
 
We checked with First Bank & Trust at Dawley Farms for a helpful guide on what parents and kids should know as they head back to class.
 
Elementary School
 
For Kids: Elementary School-aged children should be focused on learning the value and purpose of money. Not necessarily the literal value of coins and bills, but rather recognizing how money plays a role in their lives. At this age, saving money in a personal piggy bank is a great way for kids to interact and become comfortable with money.
 
For Parents: Parents of younger children should start a long-term savings account for their child by elementary school age, whether that’s a college-specific account, a general savings account or a simple piggy bank. Discussing the value of money in their child’s daily routine is important at this stage as well. They can help their kids recognize costs in their actions, such as running water, paying for the groceries or having the lights on. These discussions will help young children relate money back to tangible items in their life. Talking to children about their wants versus needs regarding money is helpful at this age as well.
 
Middle School:
 
For Kids: Middle School kids have started to earn money and spend money. Opportunities for earning may be an allowance, birthday or special event or part-time work. At this age, kids should begin learning the concepts of spending versus saving their income as well as what is the purpose of money for their long-term goals (i.e. Spend now on something small or save for a larger want later.)
 
For Parents: Parents of middle school-aged children should continue discussions of wants versus needs and continue those savings methods for their children. The conversation regarding money at this age really sets the stage for spending habits in the future.
 
High School:
 
For Kids: High school is the time where kids begin to actively engage in a banking relationship. Now is when they learn about managing an account – checks, debit card, deposits, withdrawals, online and mobile banking – and being responsible for that account. Financial decisions around postsecondary education take focus now as well. What is the financial commitment for various postsecondary education choices and how much will they need to contribute.
 
For Parents: Parents of high school-aged children need to evaluate their plan for financial assistance after their child graduates and communicate that with their kids. Give your child enough time to plan around your financial assistance. Parents also act as the oversight agent at this age – Watching what your child is taking in and spending. Education around managing an account can be a done with great teamwork between parents and a banker.
 
College:
 
For Kids: College equals credit education for young adults. Upon leaving home, kids can become overwhelmed with credit card offers and student loan decisions. College-aged kids need to seek credit score education through a banker and understand the long-term effects of a credit score. Decisions around borrowing and the ability to pay debt back on time should all factor into education and career choices at this stage.
 
For Parents: Parents of college-aged kids should continue to be their sounding board for financial decisions. They should stay involved in decisions around credit and long-term borrowing as their experiences will serve as a guide for their children.
 
To learn more and contact a banker about financial decisions at each age, visit http://www.bankeasy.com/ or stop by the First Bank & Trust branch at Dawley Farms.