The Importance of Saving for Your Kids' Future

Episode 58: Pocket Change Podcast

Summary

Key Takeaways

• Setting uo an emergency fund is crucial for when unexpected situations arise.
• Leaders has a Future Leaders Savings Account designed to help children learn how to save.
• As you think through goals for yourself, set up automated savings to stay on track for your savings goals.
• The envelope system is a great strategy for learning how to save. You split up your expenses with cash, so you can visually see how much money you are spending on each item.

Want to see when you'll reach your savings goals? Be sure to check out our savings goal calculator to know what you'll need to set aside to meet your savings at leaderscu.com/savings-goal-calculator.

The Pocket Change Podcast is presented by Leaders Credit Union. To learn more about Leaders, visit leaderscu.com.

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Full Transcript

Shea:

Hey, this is Shea

Carrie:

And this is Carrie.

Shea:

Welcome to the Pocket Change Podcast.

Carrie:

Where you'll learn better ways to spend, save, and invest, and take control of your financial journey.

Shea:

So, Carrie, this is one of those better ways to save on the podcast today, because you and I both have two boys.

Carrie:

Yes, I've got boys, you've got boys. How are we going to afford car insurance for these boys?

Shea:

I mean, you're closer to that than me, but it's important that we think about saving for our kids because there's a lot of expenses that come with having children.

Carrie:

That's right, and our guest today is going to tell us all about how to do that.

Shea:

Yeah, she's done it. She's got multiple kids, and she's been saving for them for their future. I'm excited to chat with her.

Carrie:

She's got some great tips. I can't wait. We're excited to welcome our guest today, Lindsay Jackson, one of our Financial Champions here at Leaders. Welcome to Pocket Change, Lindsey.

Lindsey Jackson:

Thank you all for having me.

Carrie:

Well, so we're excited to get into this topic today because you have a passion for helping children save money. So can you tell us where that came from?

Lindsey Jackson:

It actually came from my mom. When we were growing up, me and my sisters, she really tried to instill in us how to be good stewards of our money. Then as we got older, she really tried to help us take that same knowledge and apply it to our children. We have started savings for each of our kids.

Shea:

Tell us a little bit about that. Tell us about your family, your kids' ages, and how that all got started.

Lindsey Jackson:

I have four kids. The age range is between 11 and I have a one-year-old. I also have two girls. They are five and three. The savings really started when we had our first child. I was in college working a part-time job, and my husband and I really wanted to start a savings account but didn't know where to start. I always remember my mom's advice when I was younger, just start small. It doesn't have to be a huge amount. That's what we did. We ultimately started about $10 a week and then just kept that moving. Then we did that with each of our kids as we added to the family.

Shea:

Well, it adds up, and I think you're right. Just starting where you can and building from there and just getting started is the first step. Just do it. If it's $5, $10, you can build up from there, but you can't save $100 till you save $10. You can't save $1,000 till you saved $100. We got to start somewhere, so I think that's important.

Lindsey Jackson:

Yeah, absolutely. When they get older, that was our biggest thought is vehicles when they get to driving age or if they're ready to move out of the house or college. I was in college when we started. Those are larger ticketed items that you really... It's hard to come up with that money all at once. That's why we really decided to save and build that up as we go.

Shea:

I think what we'll find throughout the rest of this podcast is there are a lot of options, savings accounts, just regular savings, we'll talk about some of that, even some investing accounts, but the point of this is to just say, "Hey, we want to start with just $10 a week, putting that aside and saving that for the future for our kids." So important.

Lindsey Jackson:

Yeah, absolutely.

Shea:

So also at Leaders, you work in our outbound sales team, so you're able to talk to a lot of different members and different scenarios each day. So what are some things you tell them about the importance of saving?

Lindsey Jackson:

It's just a start. I've been in the banking world now for 10 years, and it is absolutely heartbreaking when you have someone that you're talking to and they can't put their hands on $50 for an emergency. It absolutely is heartbreaking. When I talk to my members, I'm really trying to educate them to really think through what their goals are, whether it is saving for their own kids, whether it's saving for themselves, and really just, if you have to, start small. Don't let it be intimidating because in the long run, things are going to come up, and you want to be prepared.

Shea:

I think you mentioned a good point about what is your goal? You want to save for your kids so by the time they're 18, they're ready to go to college or go to work, they have something there that they can use for a car payment or down payment or a big purchase or something. So you've got to have your goal in mind. What are you saving for? Saving for an emergency, saving for my kids, whatever the case is. So that's important to think about, too.

Lindsey Jackson:

Yeah, absolutely.

Carrie:

Yeah. I also think it's good because I have two boys who I'm trying to encourage to save as well, and I'm trying to teach them to save 10% of their birthday money or their Christmas money so they get in the habit of saving that 10%. So that's hard to explain. Going further into this, how do you balance saving for an emergency and for your children's savings?

Lindsey Jackson:

I actually take for my kids out of my money. When I get paid, it automatically is set up to come out of my account. That way, I don't even see it. Therefore, I'm not even budgeting it for anything else. You can take that same approach and do it for your emergency fund. My husband and I work on it a little bit differently. We have found that it works best for us. We will, of course, those funds will go to our kids' accounts, and then we'll look at our budget. We look at our tithing for our church, and then we look at what our bills are going to be, and then we go from there and then see what we need to save and for what the purpose is.

Shea:

Yeah, it's important to get each other on the same page and how you want to split that up and work together. So obviously, if you're in a relationship, it's best to do that together. I think we can support that on this podcast. We want to work together on that if we're in a relationship together because it's so important to be on the same page financially. So how do you involve your kids? Do they know you're saving for them, or what does that look like?

Lindsey Jackson:

They will know. My smaller ones will know. My oldest does know that we are saving for him. He always asks, "Hey, how much is in there?" He's always wanting to spend it on like toys or that next gift card for a game online, but we try to involve him, especially, in when he gets birthday money or he's wanting to do chores now and start saving that way. Have him sit down and walk through the process. Okay, this is how much we have. You're wanting to spend it on this toy or this gift card, and you're wanting to do that, but we also wanted to instill the savings aspect in there as well. There have been times where he didn't need anything, and he's gotten birthday money or Christmas money, and we've just set it aside. There have been even a few times he's like, "Mom, I don't need anything. Just put this in my account." We definitely try to involve him. As he gets older, that will be a deeper conversation about what it's going to look like when he's driving or has to pay for his own gas or he wants to go out with his friends.

Lindsey Jackson:

It's definitely going to be an ongoing conversation with him and then our other kids as they get older.

Carrie:

That's wonderful. What accounts would you recommend that parents should use to save money for their kids? Do you have any special accounts that you use?

Lindsey Jackson:

I have always been with Leaders before I actually worked at I've always found Leaders to be awesome when it comes to family and helping you with your own personal financial goals. We actually had sat down with a representative, and they talked to us about it, and it was a Future Leaders account. So we utilize that where you can earn the 5% on the first 500. And then anything above that, we actually rolled into a CD or any other high-yield savings accounts that leaders had to offer.

Carrie:

That's great advice for our listeners, and you're right, those are great accounts. I love the idea of rolling it into a certificate so that you can't even touch it.

Lindsey Jackson:

It's out of sight, out of mind. Exactly. Can't touch it.

Shea:

And even better for the kids is when they're in school, they can earn even more on good grades, perfect attendance, for making deposits. We do some quarterly drawings and things like that, so even more ways they could earn. We try to incentivize that saving, even on our side from the credit union, to show the importance of that to the kids. Hopefully, they're having fun along the way, getting treats and filling up their piggy bank like we have on the table if you're watching. Things like that make it fun, hopefully.

Lindsey Jackson:

My son, now that he's old enough to get A's and B's, he's like, "Mom, did you take my report card so I can get my..." It's a dollar for every A, up to $5. It is a really good incentive for our children to make good grades, but also to help them incentivize their savings.

Shea:

Absolutely. You've got a fun way, maybe, or another saving strategy. Especially those that are watching, you brought it with you a little savings book. Tell us about that and how that works.

Lindsey Jackson:

I actually got this from the idea from some of my coworkers at the oil well branch. It was a great idea. It piggybacked off the envelope system that my mom used to have me do when I was younger. It's a little savings book challenge. When I don't get a loaded tea in the morning because that's my weakness, I'll put that money into this, and then we have actual, a goal. We'll put this toward our vehicle just for a principal payment. That's another way of really saving. For me, if it's in cash, I don't want to spend it. I'll swipe my debit card all the time. I have found that just having cash and not wanting to spend it because I can visually I could see it. You see it leaving your hand. Yeah. I know. It's like, :Oh, it's all right. We can't do it." My kids are really... They love McDonald's. I hear how they want to go to Old McDonald's all the time.

Shea:

Old McDonald's.

Lindsey Jackson:

Old McDonald's, and It's like, "Oh, I've got cash. This is for this. We have to... We don't have all McDonald's money today." It's been challenging, but it definitely has been rewarding because I can visually see it and know that it has a purpose.

Lindsey Jackson:

I have a friend that's actually the opposite. She will spend her cash because she'll pull out what she knows that she can spend, and she doesn't like swiping her card. I would say, just try to find what works best for you, you and your family, and then go from there.

Shea:

There's lots of those little booklets like that. You can find them on Amazon, but you can buy your own binder and put the little baseball card sleeves in there and

Lindsey Jackson:

Yep, absolutely.

Shea:

label it for whatever amount you want to put on there. If you got an extra $5, whatever you find in your wallet in cash, set that aside and build it up. So lots of different ways. That's a cool way to do it.

Carrie:

So you've shared some great advice. Is there any specific goals that you have met that you would like to share with us?

Lindsey Jackson:

Yeah, there's been several. One that I am really proud of, when I graduated college, I had 10 student loans, and I was like, Oh, my goodness, how are we going to get out of this? So we took the advice from my mom, and I really started trying to pay that off. So now we are down to almost four of my 10 student loans. So we paid off...

Carrie:

Congratulations.

Lindsey Jackson:

Tanks! We're getting close to paying that last one-off. So it's just down to four.

Carrie:

Yeah, that's amazing. That's great, and that's what you've set your mind to, and you've had it as a goal, and you focused on it, and you're knocking it out. So that's very encouraging for our listeners. So you've already shared a lot of great financial advice. What would you say is the best financial advice that you've been given?

Lindsey Jackson:

Well, it all really has come from my mom as I've gotten older, and then as I've learned being in the financial world. It's just starting out small. You don't have to start out with a large amount. There have been times that we weren't able to save as much. Rather, we needed new tires or something just came up and we couldn't afford to save as much, but don't get discouraged. There'd be times that we were just like, "Okay, we're not eating out today," and then we take that money and set it aside. So I've really gotten some awesome advice as I have gotten older and especially working here at Leaders.

Shea:

All right. So our last question, if you had some extra change in your pocket, what would you spend it on?

Lindsey Jackson:

If it wasn't going to all McDonald's or for my kids, I definitely like, like I said, loaded teas, or going to get my nails done.

Carrie:

That's a great one.

Shea:

A little self-care splurge there.

Carrie:

You deserve it. Thanks so much for being with us today. We enjoyed hearing all your tips.

Lindsey Jackson:

Thank you for having me. It's been a lot of fun.