I inherited my analytical bent from my dad, but both my parents gave me a firm rooting in money management. My mom took me to the bank, where I learned how to save quarters and keep a checkbook balanced. My dad sat me in front of the TV with a pencil and a pad so I could record the stock prices as the scrolled across the bottom of the screen during the afternoon business shows. This was, of course, before the Internet. Now what’s a dad to do in 2011 that would be like that?
Well, I’ve decided to ease my kids into money management. No, there’s no allowance, no checkbook-keeping, and no finding stock prices on Bloomberg or Yahoo! Finance. Instead, I’ve decided to start smaller.
First, if they put their shoes away every day the whole week, I give them two coins that they can put in the church offering. We used to just give them coins to put in the offering plate, but now I want them to own that act of generosity. And making sure they put their shoes away seems like an easy but meaningful act to commit to.
Second, with Jada I am killing two birds with one stone. So far, her weekly first grade homework has been easy, so she is done well before her Friday deadline (four pages’ worth are supposed to be done at a rate of one per day, and she is often done by Tuesday or Wednesday). So each week, I have downloaded additional reading and math worksheets online (two of each), and I tell her she will earn 50 cents for each completed sheet, for a total of up to two dollars a week. I don’t actually give her the money, but put it in a clear jar so she can see it add up.
The kicker is that when Christmas rolls around, she can buy whatever toy she wants with that money. (Her piggy bank is separate. That's for saving. The jar is for spending. That's right, we're doing fund accounting!) It is not likely she will know well enough to shop around for a good price, free spirit that she is. But it is possible that seeing that she has a certain amount of money and no more may cause her to learn how to make wise choices about how to maximize her happiness within the confines of a budget. (I also take away a penny every time she leaves the light on. Fiscal prudence and energy conservation, all in one lesson!)
If you’re wondering, I’m not a fan of allowances, because I never got one. And I’m not a fan of earning money for chores, because chores are supposed to be done regardless of remuneration. Maybe when the kids get older, I’ll open up the playbook and give them more money and more freedom, but I know for sure they’re not ready. But that doesn’t mean they’re not ready for some lessons on saving and spending and giving and receiving.