Skip links

Piggy Banks to Savings Accounts: Teaching Kids about Banking

Parents, many times, are the biggest educators in their child’s life. Whether it is teaching them to tie their shoes or ride their bike, there is no doubt that parents can influence their children’s behaviors for the better. However, when it comes to financial education, some people may not know how to help their children transition from a piggy bank to a savings account. As advocates for early financial education, we understand the importance of instilling smart money habits from an early age. In this blog, we will not only delve into the benefits of making this shift, but also provide practical steps to navigate the process seamlessly. From the tangible lessons of watching coins accumulate in a piggy bank to the digital age of savings accounts, this transition is more than just a financial milestone; it’s a pivotal moment in your child’s journey towards financial responsibility. 


Understanding the Value of Saving:

A piggy bank is one of the most effective ways to teach children the value of saving money rather than spending it. Piggy banks are also a great way to teach goal setting and follow through at a young age. If your child wants a new video game or a high commodity toy they want, adding money to a piggy bank will visually show how close (or far way) they are from making that purchase. By constantly setting and reaching savings goals, children will begin to understand the importance of continually saving at an early age. This can help set a strong foundation to build on when they are older and begin earning their own money. While it might be tempting to spend their whole paycheck, they will already understand how smart and rewarding it will be to set some of that money aside for savings. This is a great habit for children to keep with them throughout their adult life.


Benefits of Youth Accounts:

Once a child outgrows their piggy bank, the next step is to transition them to a youth savings account they (and you) can monitor digitally. In a society that is becoming more and more cashless, children need to grow up understanding how to handle their money, even when they cannot physically see it in their wallets. Though some may be skeptical of introducing digital banking to their children initially, there are several benefits to introducing it early. Digital banking options allow kids and teens to access their financial accounts 24/7. This helps them check their account balances, transfer money, and even deposit checks without visiting a physical branch. Digital banking platforms take the idea of saving using a piggy bank, and allow it to grow and develop with your child to meet their needs. 

Eventually, your child’s financial needs will require more than a savings account. At this point, they will be experienced in managing their funds digitally, and may be mature enough to add a youth checking account. A great time to add a checking account is when they start their first job or take on a more active role in paying for things such as gas, food, or activities. This will come in handy as the need to keep their spending and saving separate increases. One major benefit of children having digital access to saving and checking accounts is the independence it fosters. They can valuable knowledge by managing their accounts at a young age, and it empowers them to take control of their financial future. This setup allows parents continuous oversight of the accounts, while giving children and teens the ability and safety to learn how to manage their money wisely.


Fostering Lifelong Financial Responsibility:

There are many helpful tools in building lifelong financial responsibility that go beyond just dollars and cents. Each example we provided is a basic principle that each child needs to know to be a financially responsible adult. Below are a few additional concepts we believe will help you educate your child.

  • Needs vs. Wants: We as adults know that we must take care of our financial needs before wants; otherwise, we won’t survive. However, children may not understand this concept completely. We recommend explaining this in an age-appropriate way as you discuss savings goals and spending habits. A great time to bring this is up is before going to the grocery store. Talk with your children about only purchasing the things you need to the store today – such as bread, chicken, or vegetables. Then, discuss how there may be things not on your list today that are wants. When your child grabs the cookies or ice cream, remind them that those things aren’t a need today, and maybe the next trip they can pick out an item they want.
  • Budgeting: This is one concept that is always evolving. However, explaining a budget can be simple if you start small. Work on a weekly or monthly budget that shows your child the money coming in (like allowance) and the money going out (spending). This will help them carefully consider what they spend. 
  • Borrowing and Debt: By occasionally letting your kids borrow money from you, you can slowly teach them about borrowing and debt, while controlling the risk involved. When they run out of money but want to buy something or go somewhere, let them borrow money with a repayment schedule. Have your child sign this schedule that shows how much they agree to pay back each week until the money is paid off. Explain that this is borrowing and debt. 


We’re dedicated to empowering parents and guiding our youngest members toward financial literacy. As we equip the next generation with essential skills like the importance of saving, managing your money, and budgeting wisely, we lay the groundwork for a future where financial empowerment is a cornerstone of their lives. As we partner together, we can ensure that the lessons learned today will help your child grow into a future of financial confidence and success.


Ready to open a youth account? Click here to open an account for your child today!

Return to top of page

New Member?
Forgot Password?