One of the most common questions I receive is “What age should I introduce a piggy bank to a child?” For many personal finance experts, the answer is always: RIGHT NOW! But for me, it’s all about cognitive development.
Research has shown that kids do not understand delayed gratification (or the ability to wait for a better payoff) till around kindergarten (ages 4-6).
Piggy Banks for 4-6 Year Olds
For the 4-6 year old finally getting an understanding of that big word: PATIENCE, there are a few things you can do to teach the value of the piggy bank.
First, you must understand that even though children have the ability to hold off on their impulses, they still don’t have the self control to put something into savings for a long period of time and either: 1.) remember that it is still there, OR 2.) not want to get it again after a short period of time.
A piggy bank, rather than a savings account, is great because it puts the money in clear view of the child while also being a short term activity.
Here are some of our favorite, age appropriate piggy banks:
Traditional Piggy Banks
This is a favorite in our house because of its size. It isn’t some porcelain, easy to break model. Instead, it is durable and adorable. It’s great for little kids to handle.
Counting Piggy Banks
We love this piggy bank because it takes the guess work out of how much is actually in there. And it makes the savings real for children who are not yet there on understanding value of coins.
Super Saver Pig
This pig is perfect for kids who are starting to get an understanding on savings. Best for those in 3rd-8th grade, this helps children divide up their money into “goals” such as saving, spend, donate, and invest. You can still use this one with younger learners, but you may want to limit it to just spend and save until you are ready to introduce those more advanced concepts.
How to Talk Piggy Banks and Savings for Kindergarteners
When you first introduce a piggy bank, start slow. Place coins around the house occasionally and task them with finding it. For example, “I thought I saw a penny on the carpet. Can you go find it and place it in your piggy bank?” Once they have found it, have them “feed the pig” and then forget about it.
Once your child has reached $2-3 in coins, open the piggy bank and have them buy a little treat that actually costs $1-2. That could be a pack of stickers, a favorite treat, a toy from a dollar store, etc. Whatever money is leftover goes back into the piggy bank.
The goal is to not get to zero sum, but to always have some leftover. You can use the idea that the pig still needs to eat if the child wants to spend all of their money.
Introduce a Piggy Bank to a Child Today!
If your Every Little Cent child is too young to understand delayed gratification or is not tuned into money just yet, there are ways to introduce the piggy bank to a chid with lower expectations.
The best way to do this is to model savings behaviors! Get your own piggy bank and place it in a spot where they will see it (such as a living room). Every day, empty your wallet or purse and place the change or bills inside. Exclaim loudly how you are excited to save that money for ____ (perhaps a mini-vacation, a trip to the ice cream shop, etc.).
More than likely, as kids notice your actions and the pay off, they will be more wanting to get their own version and to participate with you. You can have them place the coins inside or to help you count the amount (just counting the number of coins is equally effective).
By starting a concept of savings now, you can set them up on the path to piggy bank ownership tomorrow!