• Teach your kids the value of money.Robert Kirk/Photodisc/Getty Images
  
  Teaching kids about money is an important job for every parent. Children tend to learn about money from watching the adults in their lives, so setting a good example and being financially wise is vital. Beyond that, you can use a number of financial vehicles and tools to teach your kids about the long-term value of putting money aside for a rainy day.
  
  

Establish a Savings Account

• Having a savings account is a great way for kids to learn about the value of money and the wisdom of saving for a desired purchase. Many banks and credit unions offer special accounts just for children, complete with coloring books, stickers and games designed to teach financial literacy in terms even young kids can understand. Parents can help their kids save for a desired purchase by encouraging them to put a percentage of their weekly allowance into the savings account. Parents might even want to match the money their kids put away, much the way employers match the 401k contributions of their workers.
  
  

Value of Starting Early

• One of the biggest advantages young people have is the availability of time. When it comes to investing, time is a valuable commodity, since the investments you choose have that much longer to grow and accumulate. Just consider two investors who each invest $5,000 and earn a 7 percent return on their money. by age 70, the investor who started at age 25 will have accumulated over $1.6 million, while the investor who waited until age 35 will have less than half that. Kids have an even longer time horizon, so investing even a small amount of money now can pay big dividends down the road.
  
  

Consistent Investing

• While it is a good idea for kids to have a basic savings account, it is also important to teach kids about saving for longer-term goals. Setting up a small mutual fund account with a low cost mutual fund family can be the perfect way to save for college, the down payment on a first home and other longer-term goals. Using an index mutual fund can reduce expenses substantially, and putting a consistent amount of money in the account month after month is the best way to build the account. When you invest consistently no matter what the stock market is doing, you automatically buy more shares when the market is down and fewer when it is high.