Money saving habits | GoHenry Money Missions

Money saving habits | GoHenry Money Missions

Our new, in-app Money Missions are designed to accelerate your child’s financial education, and help us achieve our mission to make every kid smart with money. Now, when they log into their GoHenry app, kids can watch fun, animated videos, take quizzes and earn points and badges. You can use your GoHenry parent app to track your child’s progress; when each lesson comes to a close, another one begins, and your child will unlock new levels as they progress. 

 

 

Saving Habits is the third Money Missions topic. If you’ve tried to teach your child about saving or investing money, you probably already know that it can be tricky for kids to understand why it’s important to make a budget and make smart spending choices – especially when they enjoy spending their pocket money straight away!

 

Fortunately, GoHenry’s Money Missions can help to make saving money feel like fun. And, as your child progresses, they’ll unlock lessons on even more topics, including how our money grows, the magic of compounding, and stocks and shares. 

 

Your GoHenry app makes it easy for your child to create a savings goal, set a target date, and ask the app to move a set amount of money there every week. This is a great way to save for a family holiday or a special purchase, and it gives your child the satisfaction of watching their savings grow.

 

Create a savings goal

What is saving and why does it matter?

Saving means putting money aside and saving it for the future. We call this money ‘savings’. There are lots of different reasons why people save money, but it’s usually so they can buy something bigger or better in the future. When we think about savings for kids, this could be something like a new toy, a bike, a games console or a new phone. 

 

Teen savings accounts are more likely to be focused on saving for the future, like going to university or buying a car, but it’s also useful to save for the unexpected, so there’s some extra money available when we need it. 

 

To find out more, check out our Money Mission on why saving matters and how kids can learn to save money. 

 

Start lesson 1

How to make a habit of saving

The best way for kids to get really good at saving is to make it a habit. That’s why it’s a good idea to save little and often. It also helps to put a little money aside on the day that they get it – before they have a chance to spend it! 

 

Kids can boost their savings by saving money they receive for their birthday or Christmas, or by saving the money they earn from completing a particular task, such as walking the dog or tidying their bedroom. 

 

Starting a saving habit now will make it much easier for kids to save in the future – it doesn’t matter whether they’re saving for a video game, a pair of trainers, a holiday, or the deposit on their first home, the basic saving skills are exactly the same!

 

To find out more, take a look at our Money Mission on how to make a habit of saving. 

 

 

GoHenry how to save money as a kid

How to set saving goals

Even though saving is simple, it isn’t always easy – especially when it’s so tempting to use our savings if we see something we want to buy. 

 

This is why saving for future financial goals can be helpful: with a saving goal in mind, kids have a reminder of why they’re saving, how much they need to save, and how long it will take to reach their goal. 

 

There are two types of saving goals: short-term goals are for things we will be able to buy in a few weeks, and long-term goals which could take months – or even years – to reach. 

 

Whatever your child is saving for, it’s important to keep their goal in mind – as this could help them to resist the temptation of spending their money!

 

To find out more, check out our Money Mission on saving goals.

 

How does interest work on a savings account?

When we put our money into a savings account, the bank can use it to make even more money, so they pay us a little to say thanks. The money the bank pays us is called ‘interest’ and it’s a small percentage of the amount of money we have in the account. 

 

For this reason, it’s worth working out what is the best savings account interest rate – as interest can soon add up. For example, if you save £100, and the bank pays you 2% interest, you’d earn £2 over a year. But if you save £10,000 you’d earn £200 in interest!

 

Earning interest on savings is another great reason to encourage your child to save: it means their money will grow on its own, so they can reach their goal even faster. 

 

Check out our Money Mission on interest to find out more. 

 

What is compound interest and how is it calculated?

Compound interest is an easy way to grow money without having to do anything! This is because, over time, the bank will pay interest on both the money that was first added to the account, plus any interest the bank has added. This is called ‘compounding’.

 

If you want to know how to calculate compound interest, imagine you put £100 into a savings account with an interest rate of 5%. Because 5% of £100 is £5, after a year your money will have grown to £105. And the next year, you’d earn 5% on the new amount of £105, so instead of £5 interest you’d earn £5.25. 

 

Take a look at our Money Mission on compound interest to learn more. 

 

Want to teach your kids all about earning, saving, and spending money?

Create a GoHenry account today and gain unlimited access to our new, in-app Money Missions. These feature fun videos and quizzes, designed to teach kids about finances and build crucial money skills from an early age. 

 

 

 

 

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Written by Ceri Roberts Published Nov 10, 2021 ● 5 min read