Comments on: An Aged-Based Plan For Teaching Kids About Money

By: jennydecki

jennydecki — Fri, 26 Jun 2009 19:12:04 +0000

I love the suggestions. I do plan on introducing credit to my kids, but not with a real credit card. We will make a fake card that has interest, late fees, penalties, etc. and they’ll sign an application form, too.

I figure if they screw it up royally (they way most people do) when they are doing it with me, it will help them understand why mom and dad skip it and pay cash. (I can’t wait to call or harass them three times a day and say it’s because I’m a bill collector…of course my kids are stubborn, maybe they’ll be great with credit just to frustrate me LOL)

By: Jan

Jan — Fri, 19 Jun 2009 14:08:13 +0000

Heather- lots of students get allowances. I know more than a few who get them after college as well.
Good article. I agree on the job thing. I volunteered at the high school and found that many students were so taken over by their jobs that they never had time for school. Some did fine, but the majority at that high school were the ones least likely to go on to a four year college and graduate! I also found that the community was so used to those students working a jillion hours they protested when the school attempted to change schedules to later in the day (proven to be better for high school) because they would lose that cheap workforce!
Babysitting, working at the family store, yard work- yes- working at Safeway as a bagger…no.

By: DDFD at DivorcedDadFrugalDad

DDFD at DivorcedDadFrugalDad — Wed, 17 Jun 2009 13:29:58 +0000

Interesting approaches. I am going to check out the Money article– thanks for sharing it.

As for raising financially responsible kids, that is hard to do these days given the lack of help we get from other parents who can’t seem to get the word, “No.” over their lips. It makes my job twice as hard.

By: Hannah

Hannah — Tue, 16 Jun 2009 16:47:59 +0000

I am surprised to see allowance mentioned at all in the 19-22 year old age bracket. I am a 19 year old college student. I don’t know anyone whose parents are paying them an allowance just for spending money! Maybe I just know the wrong people, but I think most college students are lucky if their parents can even help with tuition and housing costs.

By: elementaryfinance

elementaryfinance — Tue, 16 Jun 2009 10:48:20 +0000

Teaching our kids to work with money is important at such an early age. What an impressive comprehensive guide.

By: tammy

tammy — Tue, 16 Jun 2009 00:37:27 +0000

You should take this to the public school system FD. I was never taught money skills at home or at school. I was raised in a super frugal family but we still couldn’t make ends meet.
Kids and young adults need to learn these skills.

By: Cheap Like Me

Cheap Like Me — Mon, 15 Jun 2009 21:20:10 +0000

Great ideas. Some things kids will be ready for at a different time. We have had my daughter save 25% of her allowance for long-term savings, save 25% in her “caring can” to give to charity (when she was littler, amount chosen for simplicity’s sake … $1 out of her $4 weekly allowance), and 50% she can do with as she likes. When I explained what a savings account was, and how compound interest works, she went right in to give her savings to me to deposit ASAP.

Now, she is 8, and we give her allowance once a month — but she has shown that she does an excellent job of saving for her goals. Paying once a month lets her have more disposable income at once, but she still tends to spread out its usage. I like that it helps her plan ahead, but a different child’s personality might make that a bad idea.

We give allowance because she is part of the family, and she does chores because she is part of the family. They are not tied, but she can do extra for negotiated fees if she wants (she usually does not).

By: Ken

Ken — Mon, 15 Jun 2009 15:53:48 +0000

Great post! I just wrote on this topic over the weekend. We are pretty similar in our thoughts. One thing I mentioned different from you was matching funds for a college kid up to a certain amount…money for food, fun.

By: Frugal Dad

Frugal Dad — Mon, 15 Jun 2009 15:46:18 +0000

@mpnmom: As a general rule, I like the $1 per week per year of age plan. Under these guildelines, your 5-year old could earn $5 per week.

I used to have our kids on a commission-only schedule where every nickel and dime had to be recorded each day as chores were completed, and the total earned was then paid out at the end of the week. It got to be a bit too cumbersome, so we started paying the kids an allowance (salary, if you will) for keeping up the same chore list each week.

I also encourage my kids to come up with extra/bonus chores not on their regular list for ways to earn extra money for things like book fairs at their school, birthday presents for friends, or to save up and buy something they really want for themselves.

One final thought…keep in mind that there are certain chores kids do just because they are members of the family (not to be paid). Similarily, there are expenses we pay for as parents, not with the expectation it has to be “worked off” by doing chores. Both sides can take this to the extreme if not careful, which puts too much emphasis on money and the earning of it, which is not the desired effect.

By: mpnmom

mpnmom — Mon, 15 Jun 2009 15:09:10 +0000

do you recommend allowance be tied to behavior or chores – or just because? I am thinking about starting with my 5 year old. Any ideas how much may be appropriate?