Money, Money, Money

Years ago, before I ever had kids, I saw the couple who wrote this book on Oprah, and I was duly impressed.  I vowed to follow their system when I had kids of my own.

I do own this book now, and I’ve read it, along with lots of other viewpoints on kids, money, allowance, saving, giving and everything else. About two years ago I even bought a bank from Moonjar; it has three separate components: one for spending right away, one for saving for something special, and one for sharing (charity). It’s the same basic concept as the authors of “Money Doesn’t Grow on Trees” use. I like it.

When K turned 5 I started giving her an allowance of $3 a week. She had to put a dollar into each of the three segments. To earn the allowance she was supposed to do some basic jobs around the house, such as putting her coat away when we got home, putting dirty clothes in the hamper and brushing her teeth. In theory, she could also earn extra money by doing a “bigger” job, but honestly this never happened. The whole allowance thing didn’t really last very long.

It’s now two years later. Both my kids seem to have plenty of money from grandparents, aunts and a favorite teacher who seem to give it frequently. I don’t make them portion out gifts of money into spend/save/share, though I wonder if I should. And the chores I expect them to do around the house are either understood (sort of), or me flying off the handle when something isn’t done.

Last week K asked if she could get an allowance. We sat down and talked about it, and came up with five jobs she needs to do everyday/regularly to earn $5 a week. Of that, she can use $2 to spend right away, has to put $2 away to save, and $1 to share – we’ll wait till we have a larger sum accumulated and choose a charitable organization that is meaningful to her to donate to. Payday is Friday. We haven’t reached the first Friday yet, so we’ll see how it goes. She hasn’t always shown herself to be responsible with money – she loses track of it easily, and I’ll find dollar bills hanging out wherever. I’d like to see more respect for money, but maybe she needs a regular source of it to develop it – I’m not sure.

K is a true child of the 21st century, since she already has a very expensive electronic item in mind that she wants to save for. For now she has elected not to use any of her “spend” money and put all $4 in savings. I’m perfectly OK with that. Especially since I will not buy it for her, not at age 7.

So, allowance question time – and if your kids are too young for an allowance, how do you think you will handle it when/if they do start getting one:

  • Do your kids get an allowance? How old did they (or will they) start?
  • Do they have to do any jobs for it? If so, what type? Can they earn extra money for doing extra chores?
  • Do they have to earmark it for certain things?
  • What types of things are they expected to buy with it? School lunches? Clothes? Birthday gifts for friends? Or it is completely discretionary?
  • Do you have veto power over any of their purchases?

3 responses to “Money, Money, Money

  1. I imagine we’ll start them when they get to school. And they’ll have to do a few chores to get it. Our allowances were to be used on anything extra we wanted. Mom covered our lunches, and we got some school clothes at the beginning of every year (5 outfits – 1 for each day of the week. Of course, they were homemade.). Anything else we wanted, including friends’ birthday presents, were on our own. Fortunately I didn’t have any very rich friends either. And birthdays were not as huge as they are now. We weren’t expected to save our allowances, but we were expected to save part of our Christmas and birthday money. Mom wasn’t a terribly good manager, so my money management skills are sadly lacking. I’m leaving it to Scott to instill the good ethics (and teach them to me).

  2. It is funny. I totally had an allowance growning up, and when my tastes got too expensive for the 5$ a week limit I had to get a paper route to buy things.

    Stewart thinks allowance is lame (and we should buy The Dictator what he wants), but I totally love it.

  3. My older kids are 6 and 8 and they both get $10/month. (Nobody complains that it’s equal, they’d complain more if it wasn’t.) I like the idea of required saving, but haven’t instituted it. I don’t have them do any jobs for it, the allowance is just their share of the household income – albiet, not much! Spending is completely discretionary, as much as I cringe at some of the choices, because I want them to learn to go broke and then have to save up. I can’t think of much I’d veto…maybe an inapproptriate movie or all candy or something? I think I’d just discourage it by saying they wouldn’t be able to watch it for X more years or eat more than Y per day. But hey, if you want to spend your money on it, by all means, waste away…

    If they wanted to earn more money by doing extra jobs, they could. (Like yours, no one ever has.) They do have jobs around the house and we use a reward chart to earn something special – like a special time with mommy (perhaps mini golf) or take a friend out to ice cream or whatever.

    I’ve recently added another catch to the money thing – if you don’t the things you need to do and mommy has to do it…mommy charges for her time. My free time is valuable, my employer pays me for it. My free time is very valuable! I’ve only done it once so far, but I charged my 8 year old $5 for finding his soccer shin guard when he was whining up a storm and clearly expecting me to swoop in and do it for him.

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