Financial expert shares smart tips to save ‘thousands’ for your kids – | Vette Leader

Start young, save more (Picture: Jam Press/Getty Images)

From investing as a toddler to holding sibling contests for cash prizes, a financial expert has outlined some ways you can save for your kids.

With the current cost of living crisis, families across the country are struggling with mounting expenses (be they bills, groceries or gas) – many are focused on providing stability for their children.

However, with rising interest rates and projected further increases in many areas of daily life, parents are finding themselves diving into savings rather than adding to them.

Laura Suter, head of personal finance at AJ Bell – who is a 36-year-old mother herself – has shared the top tips on how to save a small fortune for your little ones.

She claims “thousands” could be saved by simple tricks, while also providing a stable future for your children.

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Educate your kids about investing

Laura wants children not only to be concerned with their own money from a young age, but also to make sure that they understand the meaning behind it.

From explaining why you put money away to how it adds up over time, it’s important to include them.

She suggests “investing in a company they understand,” like Disney.

“You can then explain how buying shares in a company can help you grow and benefit when the business is doing well,” she says.

“If you’re investing money, it’s a really good idea to involve them in the process.”

Dive into the sibling rivalry

Brother and sister count coins from the savings jar

Create games to make saving more interesting (Image: Getty Images/Image Source)

Laura advises making a game of saving and letting the kids compete for prizes, or what she calls a “bonus.”

“Once kids are old enough to learn about money, they can start saving, too,” she says.

You can demonstrate this by teaching him how to save for a specific toy or showing how his previous birthday money has changed over time.

If you can, Laura says, you can even offer a matching system — where you match the amount saved or add a percentage.

“This will give them the incentive not to waste their money once they get it.” She explains.

“Another option if you have more than one child is through savings contests – find out which sibling can save the most money in a month, with a bonus for the winner.”

Open a savings account

Even if it’s a small amount of money each month, saving for your children from birth can really pay off.

If you set aside just £20 a month, an investment with a 5% return could add up to more than £7,000 by age 18, according to the financial expert.

You can even top this up on special occasions or ask family to contribute to the savings instead of buying toys and gifts.

Think about pocket money

Cute little girl wearing yellow dishwashing gloves washing the dishes

Housework is a way to earn pocket money (Picture: Getty Images)

A timeless question – how much pocket money is right?

“It can be quite difficult to figure out how much pocket money to give because it really depends on your age,” says Laura.

According to the personal finance expert, four- to six-year-olds are paid an average of £4 a week, while that rises to £12 for 14-year-olds.

But of course that depends a lot on what a family can afford.

“Younger kids might want a visual chart of how much they have in their piggy bank,” says Laura.

“It’ll give them a regular reminder of how much they’ve put away and they’ll be excited to save a few cents.”

About teach value for money

Another tip is to teach your kids the value of money by giving them chores to “boost” their income.

Try encouraging older children to value money by letting them earn it their own way.

“It could be setting up a lemonade stand, running a bake sale, selling old toys, or taking care of the neighbor’s cat while they’re away,” says Laura.

“This can help them understand the value of making money and how to keep it going.”

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