Teaching children about cash early can save them later in life

Children save money to achieve goals

CANTON, Mich. – At 8 years old, Rebecca Berry has a big goal she is working twoard and she's depositing money into her bank account to achieve it.

"Because when I'm older I want to get a good car," Berry said.

Anyone who participates in the student-run credit union with Community Financial Credit Union and Plymouth Canton Community Schools sets a savings goal when they create an account.

"You can start teaching your children very early the skills that they need to be successful with money," Natalie McLaughlin, manager of community relations for Community Financial Credit Union, said. "We have to deal with money all our lives and money is just a tool so we can help them learn how to use it very early."

McLaughlin said it's important children start handling cash when they are young, which can be a challenge now since we are becoming a cashless society. She encourages parents to have their elementary school-age children use cash to go to the store and purchase items.

Peyton Short, 9, is a teller for the student-run credit union at Gallimore Elementary in Plymouth.

"I like counting the money and adding all the coins up," Peyton said.

Rebecca is in third grade and Peyton is in fourth, but students as young as kindergarten can join the program.

The student-run credit union teaches kids how to deposit money into their savings account, along with receiving monthly statements during the school year that help them track the growth of their money.

Becoming a teller like Peyton also teaches students life skills. To apply, they must fill out an application, go through interviews, and are placed in positions to run the credit union and help other students with their savings accounts.

McLaughlin encourages giving children a small responsibility with money to help them understand the value of the dollar, where it comes from, that it doesn't just come from the ATM and that money is earned.

When kids reach middle school, the responsibilities should increase to include being responsible for more of their costs like going to the movies.

"Maybe it becomes the responsibility of the child to pay for that event so you help facilitate that through either other chores or they rake leaves for a neighbor or something like that, trying to encourage them to understand that piece of paying for things the that you want to do," McLaughlin said. "Also distinguishing the difference between needs and wants, that's still important, very important at the elementary level but also at middle school because their wants get broader and more expensive."

When they get to high school, the responsibilities need to progress again. McLaughlin says encourage them to get a part-time job if they can and have them use the money they make to deposit into an account and consider having them be responsible for another cost, for example, car insurance, a cellphone bill or something else you want them to learn about.

Students can have a checking account when they are 16 with a parent on the account with them. High schoolers can also get a debit card with this account that will teach them about using plastic but without spending more money than they have earned.

"By the time they're in late high school, definitely into the post-secondary education, it's important to teach them about credit whether they have a credit card or not," McLaughlin said. "Helping them understand what a credit score is, it's like their GPA at school it's kind of the overall picture of what they're doing with their money."

McLaughlin also says it's important for the kids to have a goal they are saving for and are asked to set one when they open a savings account with the program.

Ashmit Yerukola, 10, has a special one.

"I'm just saving up for my college," Ashmit said.

The program is not only teaching them about money, its teaching them valuable skills for later on in life.

"I learned that you shouldn't spend too much and if you save up you can get bigger things and better things," Yerukola said.

Community Financial partners with school districts across Michigan, including Plymouth Canton Community Schools, Northville Public Schools and Livonia Public Schools to teach students money management skills.

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