Saving Money For You and Your Kids

Saving a little bit of money at a time will add up in big ways!

By Brookelynn Winters

Hi! I’m Brookelynn Winters. I’m a wife, mother of two, and work in pension administration. Working with people’s retirement funds, I see first hand how saving is important. Here are a few ways to get started.

Saving For Your Children’s Futures a Little at a Time

This is something you can start now that will add up in big ways. Take $5, $10, or $20 per paycheck and put it in a separate account for each of your children. Do this every month until your child reaches a set age (18, 21, etc.), or until they move out on their own. At the appropriate time, provide the money to your child to help with larger expenses like tuition, a car, a mission, or rent.

My parents did this for me. It was amazing how helpful this fund was when I was trying to pay for tuition while in college. The few dollars from each paycheck doesn’t make a huge dent in your normal take home pay, but it really starts to add up over the years. Plus, the interest makes for a nice nest egg fund by the time they reach adulthood.

To specifically save these funds for education expenses, you can discuss with a financial planner the advantages of a 529 plan. Which is a tax-advantaged savings plan designed to help pay for education. Education savings plans grow tax-deferred and withdrawals are tax-free if they are used for qualified education expenses. It may be the right solution for you and your family.

Extra Change Can Add Up Quickly

Start a vacation savings fund. Sit down with your family and plan a fun vacation that everyone will enjoy. Once you have set the goal of the vacation, set a savings goal for the whole family. The savings goal can be for the entire cost of the vacation, or a special activity or event during an otherwise planned vacation.

To start saving money, set aside a spot, jar, or place in your home with details about the family savings goal and start adding to it. This one is fun because everyone can throw their change into to the fund. And, everyone reaps the reward together.

It can even be fun to pull out the change and count it every now and then to see your progress towards the family savings goal. This helps children understand the beauty of saving now for a later reward.

Don’t forget, interest makes all the difference. Even though we are discussing small amounts of savings, the interest can really enhance the amounts. If you are working on a vacation savings fund, when you count out the amount at the end of each month, you can put that amount in the bank so the money can earn interest. No reason not to take advantage of getting some interest on the amounts you have set aside.

Helping Your Children Save a Portion of the Money They Make

If your child has a way to make money such as, a job, chores, babysitting, mowing lawns, etc., it is a good idea to discuss savings with them. Any amount of money is a great starting point, but anywhere from 10% to 50% is ideal for their own rainy-day savings account.

Setting up a bank account for these funds is beneficial so they can start to see their savings get larger, not only from their own deposits but also from the interest earned each month. Watching their savings grow will help them build confidence in finances and allow them to have the autonomy of buying certain items on their own.

Encourage them to set this as a habit now that can continue into adulthood. We should all be setting aside a small amount to save each month. If you can help your children make this a habit when they are young, it can make all the difference for or in their future.

It may be helpful for your child to have a specific financial amount as a goal they can aim for initially. You can then transition over to just saving money and watching the balance grow.

Certificate of Deposit (CD)

As your savings account grows, you may want to consider taking a portion of your savings and buying into a Certificate of Deposit (CD) account. Certificate of Deposit accounts provide better interest rates in exchange for tying up some of your money for a longer period of time.

This means you can’t access the money whenever you want but you can get more money if you are willing to give up some of your liquidity. You can even build a CD ladder that can eventually build into the longest term CDs but also allow access to your money every 6 months, depending on how you set up the ladder.

To start, you can determine the amount that you want to invest in CDs. Note that they generally require a larger initial deposit. Depending on how much you can invest, you may have to start with just one CD at a time until you can build a full ladder.

If you have funds to start a full ladder initially, you can buy a 6-month, 1-year, 18-month, and 2-year CD. Then after 6 months take the money from the 6-month CD and invest again in a 2-year CD. Essentially, every 6 months the CD will come due, and you will have access to your money (if you need it). If you don’t need it, you can reinvest it in the 2-year CD that generally provides the best interest.

You will want to monitor interest rates and make sure you are utilizing the best CDs for your financial goals. Some CD accounts even go up to 5-year time frames. You can consider whether that length of time would be appropriate for your funds.


Once your children are getting to the age and/or stage when they get their first jobs and subsequent jobs, help them find out whether they can take advantage of any 401(k) type contributions that their employer may offer.

Many employers offer 401(k) plans and even provide “free” money by way of matching contributions. This means that as long as the employee contributes at a certain level, the company will match that amount at a set percentage. If your child starts contributing as soon as they start their job, this amount will automatically come out of their paycheck and they may not even feel the “crunch” of this additional way to save.

The 401(k) tip works for parents too! If your company offers a match in the 401(k) plan and you aren’t contributing at least the amount to get the “free” match contribution money – start now! The earlier you start saving in this way, the more compound interest you can accrue.

Note that 401(k) contributions and funds are not as accessible as regular savings since they are meant to be retirement-based funds. However, any and all savings can make a difference for either shorter-term goals or longer-term goals, like retirement.

These are just a few tips to get you started but there are tons of ways to help save money every day from cutting out expenses to being consistent in adding to your savings account. In any case, I hope this helps you to achieve all your financial goals!

Please comment below with the tip you plan to implement first.

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