Tuesday, July 27, 2010

Kids Allowance - Money and Responsibility

Teaching kids about the value of money is a difficult task. In today’s world our kids have so much, and so much is just taken for granted. How can we show them the value of a dollar, and give it some meaning? I am by no means a financial expert, but I thought I would share with you how we handle allowance in our house.

My six year old son receives $10.00 a week for his allowance, if he does all of his chores. We have a wooden/magnetic chart so we can easily adjust what chores he will be responsible for. I have included homework on his list of chores that need to be completed – even in the summertime; we work on the computer lessons for 20 minutes a day.

Ten dollars is a lot of money for a 6 year old to get each week, I agree! But he has 3 envelopes that he needs to divide his money into each week. Spend, Save, and Give. Each week he puts 3 dollars into each envelope, and then he makes a decision as to which envelope the last dollar will go into. Usually he chooses to put the last dollar into his give envelope, as he once told me “Mom, I have a lot” (that made me feel good inside!)

After he has saved up $30 or more in each of his Spend, Save, Give envelopes, he is allowed to pick something out with his allowance money. At this point he has always picked out an item that has been $15 or less! So we have even more money to go into the bank! We then go to the bank and make a deposit into his savings account, so he is able to participate in his savings.

We then also talk about local charities that he is able to support now that he has some of his own money to give. In the past we have purchased school supplies and donated to local organizations, food for the food bank, etc. I prefer to find an organization that is a bit more “hands on”, so he is not just giving mom the money and mom sends a check.

This time his choice is the local animal shelter. He wants to help out animals he says. So we will go to the store with his money and he will pick out pet food and supplies that we can purchase to donate to the local shelter.

When we drop off our donations, I can see the pride in his face. The feeling of being able to help out is amazing, and giving your child the opportunity to feel that he or she is making a difference is priceless!


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