Pumpkin already has a “piggy” bank — in the shape of a pink dinosaur. Her grandma bought it as a gift while she was still in the NICU. While she’s too young to understand the idea of money, in the future we hope to teach her the value of saving by showing her a bank account with all the gifts she’s received from family and friends. Saving is a virtue that most parents try to teach their children. (Even if it’s something they don’t practice themselves — the personal savings rate in the United States is less than 1 percent.) To figure out the best way to teach kids to save rather than spend, I turned to a expert.

Today’s Questions & Parents feature, or Q&P for short, is with Anne Colucci, vice president and chief financial officer at Quorum Federal Credit Union. The 44-year-old White Plains mom has two children, Joseph, 9, and Christina, 7. Both of her kids are already expert savers, and hopefully we can all benefit from her clever tips. (Here is a link to a related story on children’s savings in our Sunday report.)

Q: We are a country of people who spend rather than save, but when it comes to our kids, we extol the value of savings. Why?

P: For me, teaching my kids how to save wisely is indirectly teaching them how to spend wisely! For example, the children come with me to buy their school clothes; some items are on sale, other items are full price. I pick a sale item and show them the price tag, which shows the full price and the marked-down price. I explain that the difference is savings, which means that money stays in Mom’s savings account. I am also trying to teach them about earning interest on money in their savings account. I explain that the credit union pays them (interest) for keeping money in their savings account. It is difficult for them to understand why the credit union would “reward� them with more money because they hold in it in the vault.

Q: Do your kids handle real money? What has this taught them about it?

P: Joseph and Christina have been handling real money since a young age. Grandma and Grandpa give them $5 to $10 for holidays like Valentine’s Day, Halloween, or occasions such as the end of a school year or losing a tooth. I have allowed them to keep this money over the years in their own wallet, as well as excess loose change that my husband or I may have. They take the opportunity to play store with this money in place of play money. From this play, they have learned that they should keep money in a protected place when they are in public (the wallet), that it is used for purchases of goods and services, and that when there is no more money in their wallets, they’ve spent it all and can’t buy any more items from the “play store.� Using play money doesn’t have the same effect, as it never seems to run out! I am happy to say that they have not lost any of this real money (though I can’t say the same for their toys), and the wallets are returned to their safe place once their game has ended.

Q: Do your children have saving accounts, piggy banks or some mix of the two? What are their feelings about saving money? Do you have to prod them or do they like it?

P: Joseph and Christina both have savings accounts and piggy banks and thoroughly enjoy watching their money grow. I mentioned earlier about their wallets, they also keep a piggy bank for their tooth fairy money and any excess change we give them. They understand that they have a savings account for “birthday money� and money received from other special occasions, such as their baptism or communion. I show them their credit union statements and explain that the credit union has a vault where the money is stored until we need to use it. They also understand that this money is special because it will be used for their college education and that everyone who has given them money to save is special because they are helping to pay for their education.

Q: How do you explain the idea of money and make it real to children when so often mom and dad just break out a credit or ATM card?

P: Joseph and Christina have used the ATM machine and the point of sale machines in retail stores. When I show them how to withdraw money from the ATM, I make sure I also show them the balance in the account before and after the withdrawal. I have explained that Mom’s job pays her every two weeks, and my paycheck is automatically deposited into my checking account. Every time I withdraw money, the balance declines. They also go food shopping with me quite often. I always choose the self-checkout option. One child will ring up the food and the other child will pack. This allows them to understand the cost of food and how much we are getting for that money.

Q: What strategies do you use around the house to help your children learn the value of money?

P: We are fortunate to belong to a country club, and the club offers lunch from a snack bar “conveniently� located by the pool. They watch many children order lunch and a midday snack every day. No money is used for these purchases; the member fills out a lunch order ticket and puts their membership number on the ticket. Joseph and Christina are very respectful of Mom’s rules. As a treat, they are allowed to have lunch and a snack on Fridays. They fully understand that every time they write our membership number on the order ticket that Mom and Dad get billed at the end of the month. However, this summer they asked me if they could get lunch more often at the club. I reminded them of the costs and they said they understood, but so many of the other kids get lunch there every day. So I said to them, “Let’s pretend that lunch costs $1.25 every day. For the rest of the summer we’ll put $1.25 in a jar for each of you and then see how much money we saved at the end of the summer by not having lunch every day. Then we can put it in the credit union and see how much interest it earns.�

Q: Do you think it’s better for kids to deal in cash or is it OK to give them their own ATM or credit card? Does this break down by age?

P: I think we need to teach our kids to use both. At the elementary school level, we should allow them to use our cash, ATM and credit cards so that they can start to understand how these methods of banking work. Sometime in middle school or freshman year of high school, parents should open a checking account for the child and let them use an ATM card, debit card, checks and so forth. I also encourage the use of a credit card at this age and allowing the child to pay for the credit card bill from their checking account. We hear time and time again that college students are solicited for credit cards and many times get themselves into debt very quickly. Bad credit can haunt a young adult for years. Consider this all-too-common scenario: a college graduate who doesn’t manage their credit card wisely ends up with a poor credit rating. They get a wonderful job after graduation, but need a car to travel to and from work. Now they need an auto loan to buy the car but they don’t qualify because of their poor credit.

Q: How can a credit union help parents teach their children about money? Should parents feel free to ask their financial institutions for help? What programs does Quorum have for young savers?

P: Credit unions offer a safe place to save money. Unlike money in a piggy bank, money in a savings account earns interest and is federally insured by the National Credit Union Administration. Once the account is opened, have your child make regular deposits with you and let him see how much his balance has grown. Having their own account at a financial institution like Mom and Dad will help make them excited about saving. Teaching your children the value of money and saving while they’re young gives them a better chance of maintaining those good habits throughout adolescence and adulthood. Parents who would like information about how to teach their children about saving should definitely ask their financial institutions for help. At Quorum, we have employees who are experts about the different types of accounts and are always happy to educate our members on the best options available to them.

Thank you very much to Anne for sharing her knowledge by doing a Q&P! If you would like to be featured, or you know any parents who have expertise to share, please comment here on the blog or send me an e-mail at jalterio@lohud.com.

And, in case you missed them, here are links to earlier Q&P features with a Web-savvy mom, dog trainer dad, financial planner mom, writer mom, mathematician mom, baker mom, environmentalist mom, pediatric dentist mom and a couple of parents who are bicycle experts.