Children need love, a good upbringing and a happy future. Saving for children means investing responsibly. Wishes grow with age. While the little ones are happy about a new cuddly toy, adolescents need money for their driving license, their first car or a vacation.
If you set aside small amounts early on, your children or grandchildren will have a significant sum at their disposal when they turn 18. To enable them to study, train or go abroad, it makes sense to build up assets over the long term.
How does saving for children work and what options are there? This article deals with the topic of saving for children.
Children are inquisitive and capable of learning. They can learn how to handle money properly at an early age. Explain to your children what a savings account is and why it is worthwhile. The earlier you start saving for children, the higher the amount saved when they reach the age of majority.
The foundations for wealth accumulation are laid in childhood. As these are long-term savings goals, small amounts that are saved or invested regularly are sufficient.
The balance in the savings book or call money account earns interest, increasing the savings amount. More profitable returns can be achieved with shares, funds and ETFs. Seek professional advice to help you find the best investment option for saving for children. Compare several options before making any financial decisions.
Most people have heard sayings such as "I can't afford that" or "I don't have the money" in their childhood. In addition to your personal circumstances, your mindset determines whether you are financially successful.
The right attitude helps to recognize opportunities and identify savings potential. Don't you allow yourself to "have" money? Your relationship with finances reveals a lot about yourself.
Negative thoughts and deep-seated behavioral patterns prevent us from feeling comfortable with money. Do you prefer freedom or security? Saving for children secures the financial future of the next generation.
Develop a positive mindset by practicing benevolent Beliefs formulate. Get active and find out about lucrative investment opportunities. Take responsibility and decide where to spend or save the money.
Financial freedom means having enough money available to finance your lifestyle. With saved assets or passive income, your children can live in financial freedom.
The amount of money needed for this depends on individual requirements. The saying "you're rich when you have enough" illustrates what saving for children is all about.
The aim of the measures is to secure the child's future financially. This can be achieved through short-term and long-term forms of saving. It is best to combine several savings options in order to build up sufficient capital.
Creative ways often have to be found to achieve goals. When saving for children, there are various options for building up savings. The five most popular savings methods are:
ETFs (Exchange Traded Funds) are exchange-traded funds with positive performance. When saving ETFs for children, your offspring also benefit from a generally high return.
Training insurance is a low-risk investment. You pay in a predetermined amount each month. Your child will later receive the amount paid in plus interest. Education insurance is used to finance studies, training or a semester abroad.
The piggy bank is one of the most popular forms of saving. Reward your child for good grades with a coin for the piggy bank. Over time, a considerable sum will accumulate.
The 52-week challenge is an original way for children to save money. The idea of this savings challenge is to save one euro first and then one euro more in each of the following weeks than in the previous week.
You start with one euro. Then you put aside two euros in the second week and three euros in the third. In the 52nd week, your deposit in the savings account is 52 euros and your balance is 1,378 euros.
Education savings ensure that your child can finance their training, studies or further education. You lay the financial foundations for a successful professional future with an education savings contract.
Saving for education is an installment savings contract. Choose the term so that the capital saved is available in time for your children's graduation. If you pay in regularly, your children will have sufficient funds to finance their studies after graduating from high school, for example.
Start saving for education as early as possible so that your children benefit from the compound interest effect. In addition to the savings amounts paid in, the interest on the savings account also earns interest. This effect increases the educational capital. The longer you pay into an education savings contract, the higher the interest-bearing capital.
Financial security means having sufficient reserves to survive times of crisis caused by job loss and loss of earnings. A stable financial situation is important for furnishing your first home, getting a driving license and buying a car. Here are eight steps you can take as a parent to help your child achieve financial security:
You don't have to sacrifice your wishes when saving for children. The savings rate is based on your net income and is expressed as a percentage. Calculate your net disposable income from your gross salary. This is the sum that remains after all taxes have been deducted.
Financial experts recommend a savings rate of at least 5.5 percent for a gross income of between 2,000 and 3,000 euros. If you earn more than 4,000 euros gross per month, you should set aside at least nine percent of this to save for children and yourself.
Keep a budget book to keep an eye on your expenses. Savings rates and living costs can be calculated accurately online using special computer programs.
Before you start saving for children, you should compare several savings products. Because of the tax advantages, it is advisable to open a bank account or securities account in your child's name.
Comparison portals such as Check24 regularly publish test reports on investment options and forms of investment. As a comparison site, Check24 devotes several guide articles to saving for children. In these articles, the financial experts describe how call money and fixed-term deposits offer better interest rates than traditional savings accounts.
Other financial products suitable for children are active investment funds and ETF savings plans. In combination with a securities account, ETFs are ideal for building up assets over many years.
Your risk affinity and the regularity with which savings amounts are paid in will determine the optimal form of investment. An overnight deposit account is suitable for short-term investments, while a fixed-term deposit account is a good option for one-off investments.
What to look out for when saving for children? When should you start investing? The longer you invest, the more money you will save. It's best to decide on a savings method after your baby is born.
What should be done with the investment amount? The intended use determines whether an investment with a short-term or long-term goal is suitable.
Are the sums you have paid in to save for children not enough? Ask family members, friends or relatives to support you. Gifts in the form of additional deposits are a good idea for children's birthdays, first day at school and other occasions.
How can your child access funds at short notice to cover the costs of school trips and private lessons? You can withdraw money from a traditional savings account at any time.
Saving money for children is an important form of support. It enables you to give your children a financially stable future. We give you practical tips on saving and building up assets in our free masterclass: Never worry about money again. With specialist knowledge about money, you can fulfill your wishes and realize your financial security.
