Friday, October 10, 2008

Children and Money--Part #3

One tool that will introduce money and what it can be and/or should be used for is an allowance. Parents will need to do some solid thinking about how much to give at an given age and what the requirements for that allowance are. Start small and for very young kids don't include anything that is a necessity; i.e. don't "charge" meals against the allowance. But what should be stressed is that the allowance is time sensitive; get that allowance on Sunday and spend it on Monday and you will have no more spending and/or savings money until the next Sunday. (It's like those cookies and pretzels that were divided in Part #2.) And stick to your guns.

Depending on the age of your child you can also offer "overtime" work incentives. Cleaning up or straightening up their rooms is not something that should be paid for. It is what they do as part of a family. But extra jobs that don't fall into the category of family jobs that they need to do can offer a small financial incentive or perhaps a negotiation of extra time on the computer or something of that ilk. A job like polishing silver or taking the pots out of the drawers and cleaning the drawers are examples of the type of "extra" work I am thinking of. And along with this extra money comes the responsibility to discuss savings.

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