The Jar System : How to Teach Money Management to Young People
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Using the Jar System to Teach Money Management
Important notice:
You can begin using envelopes if you don't have jars. Just label your envelope or jars with the appropriate labels. After you get to $100 in any jar, open a saving account and keep a small amount of money in your jar. Or put the bank deposit receipt into the jar instead of the actual money. (keep a little cash in your jar at home if you want)
1)Label your first jar TITHES:
The is your most important jar. Put 10% of all the money you earn in this jar. Take it with you to church and pay your tithes.
2)Label your second jar FFA:
FFA means Financial Freedom Account. "10% of all you earn is yours to KEEP"(The Richest Man in Babylon). This is the second most important jar after the tithe.
This jar is the key to wealth. Guard this jar and purpose not to spend this money. You may only use this money to INVEST. This money in this jar represents your seed for making more money.
(continued below)
You can begin using envelopes if you don't have jars. Just label your envelope or jars with the appropriate labels. After you get to $100 in any jar, open a saving account and keep a small amount of money in your jar. Or put the bank deposit receipt into the jar instead of the actual money. (keep a little cash in your jar at home if you want)
1)Label your first jar TITHES:
The is your most important jar. Put 10% of all the money you earn in this jar. Take it with you to church and pay your tithes.
2)Label your second jar FFA:
FFA means Financial Freedom Account. "10% of all you earn is yours to KEEP"(The Richest Man in Babylon). This is the second most important jar after the tithe.
This jar is the key to wealth. Guard this jar and purpose not to spend this money. You may only use this money to INVEST. This money in this jar represents your seed for making more money.
(continued below)
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How you use your FFA Jar
You can use this money to buy something (at a low price) that you can sell for a higher price and make a profit.
Save up the money in this jar until you can buy things like : gold and silver coins, or items that you can buy cheap and sell like candy, clothes, jewelry etc. Use it to start a business, buy land, buy houses etc.
You must buy things that make you more money when you use or sell it.
3)Label this third jar COLLEGE: If you think you are going to college someday, label this jar college. If you or not sure, you can label this jar CAREER.
This jar is for you to use to save up money so that you can have money for Art School, College, Nursing School, Computer Programming School, Modeling School etc.
(continued below)
Save up the money in this jar until you can buy things like : gold and silver coins, or items that you can buy cheap and sell like candy, clothes, jewelry etc. Use it to start a business, buy land, buy houses etc.
You must buy things that make you more money when you use or sell it.
3)Label this third jar COLLEGE: If you think you are going to college someday, label this jar college. If you or not sure, you can label this jar CAREER.
This jar is for you to use to save up money so that you can have money for Art School, College, Nursing School, Computer Programming School, Modeling School etc.
(continued below)
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How to use your College or Career Jar
This money is to help you pay for training or schooling so that you can study and help pay for the career that you are interested in.
You may not have all the money you need, but some money saved up is better than no money saved up. Start thinking and planning your future now!
4)Label the fourth jar NECESSITIES: Use this jar to put money into that your parents give you for clothes or personal things that you need to buy. (hair products,clothes, shoes. etc)
If your parents pay for all your personal needs, just store the money in this jar until you use it.
If you don't get money from someone (parents) to buy personal needs, then you must put some money in this jar every time you get some.
If you pay for your own personal needs then you must be wise and plan ahead for these needs. Little by little, put something in this jar when you get any money that comes into your hands. (But remember you must put money into jars 1-3 first before placing money into this jar.)
(continued below)
You may not have all the money you need, but some money saved up is better than no money saved up. Start thinking and planning your future now!
4)Label the fourth jar NECESSITIES: Use this jar to put money into that your parents give you for clothes or personal things that you need to buy. (hair products,clothes, shoes. etc)
If your parents pay for all your personal needs, just store the money in this jar until you use it.
If you don't get money from someone (parents) to buy personal needs, then you must put some money in this jar every time you get some.
If you pay for your own personal needs then you must be wise and plan ahead for these needs. Little by little, put something in this jar when you get any money that comes into your hands. (But remember you must put money into jars 1-3 first before placing money into this jar.)
(continued below)
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How to use your Necessities Jar
(This necessities jar will become more important when you are living on your own and have to provide for yourself)
When you are living on your own, the necessities jar is where you will get the money to pay your expenses: light bill, phone bill, food, rent etc)
For now, just store all the money your parents give you to go shopping here until you are ready to shop.
5)Label this fifth jar GIVE: Put some money(you can choose a percent or just decide how much you are willing to give cheefully) into this jar so that you will be able to give an offering or purchase gifts for the people you know and love without taking money for the other jars.
Start by saving a few dollars into this jar. Each time you get money put something in even a $1 or a penny. Something is better than nothing.
6)Label the sixth jar PLAY: This is the most fun jar ever. You get to spend all of the money that lands in this jar every month. You can't save it up. You must BLOW it on something that you enjoy.
If it's only a penny, buy some penny candy.
(continued below)
When you are living on your own, the necessities jar is where you will get the money to pay your expenses: light bill, phone bill, food, rent etc)
For now, just store all the money your parents give you to go shopping here until you are ready to shop.
5)Label this fifth jar GIVE: Put some money(you can choose a percent or just decide how much you are willing to give cheefully) into this jar so that you will be able to give an offering or purchase gifts for the people you know and love without taking money for the other jars.
Start by saving a few dollars into this jar. Each time you get money put something in even a $1 or a penny. Something is better than nothing.
6)Label the sixth jar PLAY: This is the most fun jar ever. You get to spend all of the money that lands in this jar every month. You can't save it up. You must BLOW it on something that you enjoy.
If it's only a penny, buy some penny candy.
(continued below)
How to use the Optional Jars
OPTIONAL JARS
( If you understand this system, add more jars as you are able, but you must follow the previous system for jars 1-6)
EDUCATION:
This jar is money for classes, seminars and lessons that you enjoy, classes that promote life skills or helps you to become a life long learner.
For example you can take sewing, knitting, karate, cooking, or dance classes. When you get older you can attend wealth seminars or learn about whatever you want to learn. You will have money for these classes then if you start saving a little now.
LTSA means Long Term Saving Account:
Use this jar to save up long term for items like a car, a prom, graduation, a new bedroom set, a wedding. Big ticket items.(Items that may cost over
$250)
Contingency Fund:
This jar is only needed when your are on your own. This jar is important because it provides some security for the future. Your goal is to put away 6-8 months of your monthly income.
You do this by saving a little at a time for each paycheck. Whatever you can put into this jar do it faithfully. When the total reaches up to 6-8 months of your monthly income. Stop!
Now you have just created a cushion for yourself. If you were to lose your job or some crisis, this money would be here for you to use.
The main purpose of the money is to give you a security cushion.
(continued below)
( If you understand this system, add more jars as you are able, but you must follow the previous system for jars 1-6)
EDUCATION:
This jar is money for classes, seminars and lessons that you enjoy, classes that promote life skills or helps you to become a life long learner.
For example you can take sewing, knitting, karate, cooking, or dance classes. When you get older you can attend wealth seminars or learn about whatever you want to learn. You will have money for these classes then if you start saving a little now.
LTSA means Long Term Saving Account:
Use this jar to save up long term for items like a car, a prom, graduation, a new bedroom set, a wedding. Big ticket items.(Items that may cost over
$250)
Contingency Fund:
This jar is only needed when your are on your own. This jar is important because it provides some security for the future. Your goal is to put away 6-8 months of your monthly income.
You do this by saving a little at a time for each paycheck. Whatever you can put into this jar do it faithfully. When the total reaches up to 6-8 months of your monthly income. Stop!
Now you have just created a cushion for yourself. If you were to lose your job or some crisis, this money would be here for you to use.
The main purpose of the money is to give you a security cushion.
(continued below)
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HenryE wrote...
My parents did this with us as kids and it really helped to teach us good habits, I think. I hope to do it with my kids, too!
Posted May 27, 2009
minnymalse wrote...
Hi. I really like this lens. I save money in a ceramic piggy bank!LOL
Posted July 23, 2008
Lensmaster
Wade J wrote
Excellent information. I attended a T. Harv Eckert workshop that devoted much of its teaching on the jar method. It's a great learning tool that requires consistent action and makes the process fun. It develops discipline using healthy personal motivation and fosters a very useful and rewarding 'habit.'
Posted July 16, 2008
Lensmaster
Any H. wrote
Great tips!
Posted May 14, 2008
How to use your STSS and LTSS Jar
STSS means Short Term Saving System. Use this jar to save up for an item that you may need soon. For example: a watch, prescription glasses, a bike, a birthday party, Disneyland, Knottsberry etc. Smaller ticket items. (Items may cost under $150)
In the STSS or LTSS category you could have more than one jar if you want. You could label one of your jar LTSS Car or LTSS Prom. You can get fancy as you understand the system. You could also just have one piece of paper saying:
Car: $210,
Prom dress: $175
Wedding: $25
and place the paper into one LTSS jar if you want.
You can just list how much money you have saved up so far for each item on the paper. You decide how elaborate you want to be. You can add multiple jars or just use one jar with one list inside.
Whatever you decide, have fun with this system!
Best wishes To your financial future!
In the STSS or LTSS category you could have more than one jar if you want. You could label one of your jar LTSS Car or LTSS Prom. You can get fancy as you understand the system. You could also just have one piece of paper saying:
Car: $210,
Prom dress: $175
Wedding: $25
and place the paper into one LTSS jar if you want.
You can just list how much money you have saved up so far for each item on the paper. You decide how elaborate you want to be. You can add multiple jars or just use one jar with one list inside.
Whatever you decide, have fun with this system!
Best wishes To your financial future!
