Greenlight Savings: The new way to teach your kids the value of saving money

The money conversation. It can be one of the hardest conversations we have with our kids (let’s be real: it can be one of the hardest conversations we have with anyone). But it’s also one of the most important conversations we have to have as parents.

Kids aren’t born understanding money. Ask any parent and they’ll tell you a hilarious story about the time their kid thought banks just gave money away or that cashiers did nothing more than approve your selections. It’s cute, but — as much as we want to preserve our kids’ innocence — it’s unsustainable and potentially dangerous.

Understanding money — how it can grow, how it can be used, how it can disappear — is important to every child’s development. There are tons of tricks you can use to get them to learn, but whether or not they’re effective is up for debate. At Greenlight, we’re thinking beyond giving your kids a jar and asking them to count their pennies; we’re thinking about a real way to teach kids about money.

That’s why we’ve developed Greenlight Savings. It’s an educational tool that allows kids to earn interest and save their money. Your kids will be able to watch their money fluctuate as they earn interest, and spend it (with your permission) helping them understand how saving money can pay off in the long run.

Greenlight Savings isn’t a typical savings account. It’s a parent-managed tool that teaches kids the value of saving money, but also how interest — and patience — pays off. Instead of earning the tiny amounts of interest typical savings accounts offer, parents can set and pay higher interest rates so their kids can actually see their money grow.

Here’s how it works:

1) From your Greenlight Parent’s Dashboard, you can add money to the Savings category on your child’s Greenlight card. It works the same way as adding cash to any Greenlight category, and we’ve already added it as an option so you’re ready to go.
2) Once you’ve added money, you’ll be able to set the interest rate. Pick a rate you’re comfortable with, since you’ll be paying that interest.
3) We automate the process. Your child’s Greenlight Savings will earn interest once a month and it will be drawn from your Greenlight Parent’s Wallet automatically.
4) You can add or move money anytime, right from your Parent’s Dashboard just as you would for any other category on their Greenlight card. And your kids can move their money too: they can put money in whenever they want, but need your approval to move it out.
5) The savings grow, and your kids start to understand how saving can help them set and meet spending goals over the long term.

Since kids don’t typically deal in large sums of money, regular savings accounts with small interest rates don’t show real growth. But since you can set higher interest rates, Greenlight Savings shows kids how interest works over time, so they can plan how to use their money down the line. It also teaches them the value of patience and planning: while they may want to buy the latest online game or must-have toy immediately, they’ll come to understand that by waiting a bit, they’ll have even more money available – for that toy and maybe a snack or two, also.

And since it’s all parent-controlled, you’ll have oversight into what your kids are doing so that you’re always prepared for that dreaded money conversation. Only now, you can rest assured that it will be pleasant, meaningful, and productive.

Equip your kids for financial success today with Greenlight Savings. If you’re already a Greenlight customer, you can get started with Greenlight Savings at no extra cost. And if you’re not, signing up is easy. Simply visit us at www.greenlightcard.com and tap download to get our app and begin registration.

 

(photo courtesy © GotCredit cc2.0)

New Year Resolutions & Bright Futures

Studies have shown that financial health is strongly connected to physical and mental wellness. There’s no better time than now to start routines that set your kids up for financially-healthy and happy futures. Let Greenlight help you set new year resolutions that you’ll actually keep to jumpstart your progress.

Resolution #1: We all need a bit of balance (tracking)

Our goal at Greenlight is to make sure all kids are empowered to make financially-smart decisions. We think empowerment starts with knowledge — working with kids to make sure they understand how much they earn, how much they spend and how they should save. 

Tip #1 is all about making sure kids take the time regularly (dare we say it, daily?!) to track their spend history and account balances. This new year resolution will naturally spark conversations around trade-off decisions, teaching your kids responsibility in budget management.

Within the Greenlight app, kids are able to monitor their spending, earning, saving, and giving history. This allows kids (and parents!) to track:

  • How much to expect in allowance
  • How much is available to spend
  • Progress toward their saving goals

“I have two teens (13 & 14). Being able to see their spending and balances digitally via the app has made them much more mindful of how and when they choose to spend their money.”

Antoinette K, Greenlight mom

Resolution #2: Save! Save! Save!

We know it’s hard for kids (especially the young ones!) to understand the difference between wants and needs. Starting kids out with a savings account early can teach them to save for what they want and be prepared to cover what they need because unexpected things happen. 

Consider mapping out a monthly plan with your kids to help them articulate, save for and reach their goals. 

The most popular saving goal for Greenlight kids in 2019 was a car!

If your kids earn an allowance based on grades or chore completion, write out how much each grade or task is worth. That will help them calculate what they need to do to accomplish their goals.

Parents are also able to help their kids reach their goals by setting aside a portion of allowances into their child’s Greenlight save account, helping reinforce wise saving habits.

Setting up saving goals within the Greenlight app helps kids visualize what they’re saving for and regularly track their progress.

Greenlight kids who create saving goals save 29% more than kids who don’t.

Once a week, consider having a family meeting to talk about how close your kids are to reaching their goal. Reviewing their spend history can help kids rethink a plan for the next week on how to spend less and save more. This regular routine can turn into a long-term habit that magically reduces the number of times you get asked for money.

Resolution #3: Watch savings grow with Parent-Paid Interest

After you get your family into the habit of saving, it’s time to learn about how to make your savings grow. Greenlight helps teach the power of compound interest by offering parents the ability to pay a parent-paid interest rate on top of their child’s savings.

On average, Greenlight families set a parent-paid interest rate of 18%. 

Once your kids understand the concept of compound interest, you can set your parent-paid interest rate to a more realistic one and have conversations around what grownup savings accounts typically earn.

Resolution #4: Have you done your chores?

Chore routines can be a great way to show your kids that money has to be earned. A recent poll of Greenlight parents showed that 73% give allowance, and 47% say their kids have to earn it. 

Use the beginning of the year to reassess your family’s chore routine. With age may come new responsibilities, changing the chores typically assigned to your kids.

However, if ever, you choose to reward your kids for chores, Greenlight can help with task management. With the Greenlight app, you can set one-time or weekly chores based on the routines you set for your family. 

In 2019, Greenlight helped kids finish 1.8 million chores!

Parent reviews all chores in one view within the Greenlight app.

If your child does dishes weekly, Greenlight allows parents to assign tasks and regular deadlines. If your child contributes to other household responsibilities by cleaning the gutters once a month, one-time chores may be assigned with an optional monetary reward upon completion.

Whatever your goals, Greenlight is here for you.

Greenlight is here to help your family feel empowered to talk about money and form smart habits with all the tools to raise financially-smart kids. Not a Greenlight member? Sign up today!

Greenlight’s 2019 Year in Review

You did it. You celebrated the birthdays, packed lunches for soccer tournaments and survived the endless conversation about Minecraft. Congratulations, Moms and Dads — you’ve made it through 2019. 

As we look toward 2020, allow us to celebrate the unsung heroes of financial literacy – YOU! The hundreds of thousands of Greenlight parents teaching their kids the value of a dollar and the art of making smart trade-off decisions.

In 2019, Greenlight kids did 1.8 million chores and collectively managed more than $150 million. But that’s not all.

Greenlight's 2019 Year in Review infographic. 
Kids managed $150+ million in 2019.
They set aside $2.6 million to give and did 1.8 million chores.
On average, they spend $91 per month, and 30% of what they spent went toward food and grocery.

Looking toward 2020

In 2020, we’ve got big plans to improve the Greenlight app and add more features for your kids to learn the full-spectrum of money management.

We’ll be weaving more educational layers into the Greenlight app, making it fun (and painless!) for kids to build smart earning, spending, saving and giving habits.

Our team is also building tools for kids to learn all about the world of investing, with a new suite of features that allow kids to invest in multiple funds and even buy fractional shares from their favorite companies.

Our single most important job is to support you – the parents doing the hard work. Together, let’s make 2020 the Year of Financial Literacy.

*Data captured from Greenlight families based on activity from Dec 2018 to Nov 2019. Average monthly spend calculated only for kids who spent.