What age to teach your kids about money? (cartoon, teens, allowance)

[twoincomes]

What age do you think is a good way to teach your kids about money? How do you go about doing it?

[aliss2]

My 4 year old gets $1 per week to choose something from the corner store, and we take the time to talk about numbers when he picks something that is too expensive.

[ScarletG]

Originally Posted by twoincomes

What age do you think is a good way to teach your kids about money? How do you go about doing it?

This can be a tough one. We gave a small allowance (not for chores, but she did have them - we felt those things were just part of being in the family so we didn't 'pay' for them....but part of being in the family was certain privileges, and an allowance was one of those). 1/3 was saved in a bank account, 1/3 could be spend immediately if desired, 1/3 was saved up for a larger goal in the near future. Later we included gift money in this.

It taught her both long and short term saving goals. Later in middle and high school, we added her lunch money for the week to the amount she got outside of the 1/3-1/3-1/3 allowance. It was up to her to budget what she bought for lunch (they could leave campus in high school, so if she wanted Cook-Out each day....she was gonna be out of lunch money by Wednesday and have to dip into her own funds.

She's a college freshman now....and seems to have a decent grasp on things....I think the truth will show more next year when she lives off campus.

[no kudzu]

With our first two children we started with small allowances. And we too believe that chores are part of being a family and should not be connected with allowance. Allowance is to teach responsible money management.

When our first 2 were little we did much more recreational shopping than we do now. At the time we told them they could buy extra things we felt we were not obligated as parents to provide. But a weird thing happened. neither one wanted to spend, didn't ask for extra things from us and ended up saving their allowance...almost all of it. Neither one was much of a clothes horse, interested in fashion or video games. Actually they were born in 81 and 83 so there was not much except mario brothers..no computers that I recall. Son did like to collect coins which turned out to be a good investment and he liked to buy Calvin and Hobbs cartoon books and a few he Man "dolls" which he loved. But he usually liked to go halfsies with us on those around birthdays or special occasions. Daughter not interested in jewelry or cosmetics. Son did get into heavy metal which he bought with his own money from part time jobs in high school.

Today they are debt free with good jobs, savings and healthy 401 accounts. Daughter refuses to even let us help her with flying expenses for when she flies from Atlanta to N.C. to visit us. But twice she has accepted frequent flyer miles from our business travels but she says it is more trouble than it is worth with so many restrictions.

So with the second set of kids 19 years apart we tried to do allowance but they forgot to ask, we forgot to give, we don't hang out at shopping malls or do recreational shopping. Finally the girls said they wanted a family meeting about money. They said they wanted to start spending their own money and for us to not buy them anything except on birthdays or Christmas. OK... They decided they wanted individual cameras to take on field trips, spring break, etc. It was near birthday time for 12 year old so we made this arrangement: She would give us $50 towards purchase of new camera, take her shopping for what she wanted and we would pay the balance as her birthday present. Other daughter gave us $50 towards her Daddy's camera with stipulation he could use it when he needed it. She was happy with that.

One thing we did was involve them with making regular deposits in their college savings accounts. We explained credit cards, mortgages, taxes etc to them as age appropriate. I am having vision challenges now so I have both girls helping me pay bills on line. I showed them our family budget and when we grocery shop we make our list from weekly flyers and sometimes I have them return items to the shelf if i see I'm going over our food budget.

I think kids tend to mimics what they see their parents do. If we came in with bags of clothes and shoes and wines , etc I think they would have been much more into consuming. The only thing they saw us splurge on was plant material for my beautiful gardens and Daddy's collection of hats. He's bald and wears a hat just about 24/7---even in the house.

I had a friend whose 6 year old daughter had 14 pairs of shoes! She bought her and herself every fad piece of clothing and jewelry. And then she wondered why this daughter got in trouble with shop lifting (Mom did too) and had tremendous debt before she was even 25. The apple doesn't fall too far from the tree.

[Kibbiekat]

I think it starts from the beginning. As toddlers they can be told they can't have something or have to choose between 2 items because they cost too much. We started allowance when they started asking for pricey items, which was about ages 6 or 7 and 8 or 9. They each have 4 jars - save, spend, donate, invest. Invest just means we'll put it in the bank for them to use later. They use donate for offering at Sunday school, or for things like the canned food drive at school. They spend their own money on apps, music, toys, posters, or whatever they want to buy.

[Aggiebuttercup]

From the time mine were babies, I showed them the boxes at the grocery store where they collected for the cause of the week. I always put in a few coins and told them why -> "this is to help the firefighters who protect our homes. This is to help sick kids. etc" I'd give them change to put in the Salvation Army bucket and explain what it is for.

I started giving them actual money at age 4. Usually 4 quarters a week, and once a month we went to the dollar store to spend it. When they started school their allowance increased.

At school, they learned the names and values of the different coins.

The kids go to the bank with me regularly, and I talk about why we are there - that I put my money into the bank, and the bank holds it for when I need it.

I opened a bank account for my oldest daughter when she turned 7. She has to put part of her gift money in there, and we put in money for good grades. Every month we look at the bank statement together and talk about interest and compounding (even a few cents is exciting!).

We take a big family vacation every 18 months. I will match whatever they save for that vacation - so they are learning that saving is great, and we're getting a head start on valuing a 401k match

At the store, we talk about not buying what isn't planned (toys aren't on the grocery list, guess we aren't buying toys). We talk about why this is more expensive than that, and is it a good value.

Basically, I talk about money and prices and values all the time. It's not a secret, it's not scary or hidden, it's matter-of-fact "this is how the world works". I'm confident by the time they are teens they'll be in good shape.

[Osito]

The earlier the better, probably around the time that they start learning how to count money in school. It might help them to give them a dollar or something for them to buy a treat with, and they pick something they can afford when you go shopping. Teach them if they want more, then they can do chores around the house or for other people they'll be paid accordingly.

[Katnan]

I got an allowance starting when I was five. It was fifty cents a week. One quarter went to the collection plate at church, and one went to my weekly dues at Brownies. lol But I do remember feeling empowered that I was spending my money.

Money management, saving and spending can't be taught early enough, IMO. Beyond birthday and Christmas gifts, the sooner a child realizes what it means to have to earn money, the more opportunities they have to make good choices, instead of just wanting (or expecting) something and it miraculously appears. I also think, for the most part, if they have to earn and save, they have more appreciation for the item and take better care of it.

[golfgal]

OP=might I suggest some parenting classes. You seem really insecure in your parenting skills with all of the questions comparing your child to the rest of the world. It might help you to see how detrimental this will be for her development and give you some good strategies for raising her.

[Katarina Witt]

Originally Posted by Aggiebuttercup

From the time mine were babies, I showed them the boxes at the grocery store where they collected for the cause of the week. I always put in a few coins and told them why -> "this is to help the firefighters who protect our homes. This is to help sick kids. etc" I'd give them change to put in the Salvation Army bucket and explain what it is for.

I started giving them actual money at age 4. Usually 4 quarters a week, and once a month we went to the dollar store to spend it. When they started school their allowance increased.

At school, they learned the names and values of the different coins.

The kids go to the bank with me regularly, and I talk about why we are there - that I put my money into the bank, and the bank holds it for when I need it.

I opened a bank account for my oldest daughter when she turned 7. She has to put part of her gift money in there, and we put in money for good grades. Every month we look at the bank statement together and talk about interest and compounding (even a few cents is exciting!).

We take a big family vacation every 18 months. I will match whatever they save for that vacation - so they are learning that saving is great, and we're getting a head start on valuing a 401k match

At the store, we talk about not buying what isn't planned (toys aren't on the grocery list, guess we aren't buying toys). We talk about why this is more expensive than that, and is it a good value.

Basically, I talk about money and prices and values all the time. It's not a secret, it's not scary or hidden, it's matter-of-fact "this is how the world works". I'm confident by the time they are teens they'll be in good shape.

You did not ask for advice, and while not exactly giving it out, you're setting yourself up as a great example. While I agree with some (take note of word) of your approaches, I am going to offer some advice to you: quit talking about "money and prices and values all the time".

For one thing, kids are great imitators. Do you really want them telling their friends how much you spend on everything and why? For another, many people think talking about money "all the time", and believe me I know some people who do just that, is gauche. Talk about the weather. Talk about movies. Talk about politics (just not on this forum, I agree!). Your kids may not get the connection between you matching their savings for a vacation and a 401K. In addition, there may be some totally different funding mechanism for retirement by the time they reach adulthood as they are apparently pre-teens now. When I was a pre-teen, the term "401-K" had not yet been invented. There was SS, private pensions, and savings, period.

Bottom line is the parents are still supporting their kids. All this matching and earning a few pennies interest (not much more than we earned on our checking account this past year, BTW) is irrelevant. You can get arrested for not providing food, clothing, shelter, health care and education to your kids, no matter how much or how little they save.

We did not talk about money and prices and value all the time, though my spouse and I certainly practice those things. Our kids learned from modeling us how to be good money managers, and they are. There's more than one way to do it.