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My idea for teaching my kids the value of money

Your kids are spoiled.  Admit it.  You may not see any negative indications of their spoiled-ness (my word, Hands Off!), but it affects them for the rest of their lives.  It’s your fault.

You’re not alone.  We want our kids to have it better and easier than we did when we were growing up.  It’s not always about not saying “No” from time to time.  It’s more about being a good provider and trying to raise the best kids we can.  I posted about teach your kids financial literacy HERE.  However, my kids weren’t even close to that level yet.

kids love money
Oh yeah, this looks like trouble….

They live in a different world though.

Today with all of the technology and phones, it is much different than it was when we were kids.  The simple fact that the kids can communicate to each other now over long distances and social media makes it difficult to be conservative parent.  All to often, little Johnny is comparing himself to little Bobby because little Bobby posted some crap on Snapchat or something.  While it is easy enough to say no to this, you are juggling that with trying to be a good parent and provide more for little Johnny than you had at his age.  So maybe you say Yes.

But where do you draw the line?

Once they are old enough, you can attempt to teach them the value of money.  It’s not as easy as just laying out a quick lesson.  I mean, you can give them all of the data that you can muster up, but it isn’t until they can really put it to practice, that they will truly understand.  It’s one of those lessons that seems to need to be learned the hard way.

My kids used to think that money just fell from the sky and into our pockets every minute of the day.  They would continually ask for things, like all kids do.  The difference with our kids is that even though we told them that we didn’t have any money at that time, they would invariably ask for something at the next store we stopped at.

We had their hearing checked….

They passed the hearing test, and as it turns out, they just didn’t seem to understand the way it works.  Additionally, they didn’t seem to post any value to money.  It was a number for sure, but to them all that it means is that it is the amount that we needed to pull out of our magic pockets to give to the nice lady at the register.

It is truly a fantasy land in the eyes of a child.  If only…..

On top of that, it seems that when we are pretty much out of money is when the kids would inform us of an expense for school, or activities, and even just a basic “want”.  I get paid every two weeks and it typically happens in the second week of my pay period.  They were killing me.

Like most parents, we decide that we should try to institute some chores around the house in exchange for an allowance.  This would give our kids some sense of the value of money and a bit of work/income ideals.

We’re gonna be voted the parents of the year for sure!

Once we got the allowance system for our kids set up we found that it wasn’t really working the way we wanted it to.  It’s not that they weren’t grateful to earn the money but it just wasn’t ideal.  There were a lot of holes in the fishing net.  If there is one talent that my kids have developed, it is finding loopholes in your process that they can exploit.

I was a having a the usual difficult time keeping my two kids doing their chores to receive their allowance.  Moreover, if my wife or I asked them to do something outside of their usual chore list, we would get flak from them.  “Why do I have to help?” “It’s not my job!” “Whaaa!”  We found out that it was nearly impossible to list and divide absolutely everything that we could possibly need help with in our household, ever.

So I had a plan.

Since I get paid every other week, now I pay the kids every other week.  They are each paid $1.00 for every year that they are alive.  So, currently, the boy child is 14, he gets $14 per pay period.  The girl child is 17, so she gets $17 per pay period.  Of course they get a raise on their respective birthdays.  Just another reason to look forward to it.

However, there is a catch.

I give them the complete amount, but they MUST give me back at least $2.00 to go into savings.  They can put more in if they choose, but they can’t put in less.  Dems da rules.

Contingent on this pay is that they will do what we ask, when we ask it of them.  Their job is to contribute around the house.  Kind of a do-it-all assistant.  Should they fail at this simple job description, they get fired.  No work equals no pay.  No pay means that we will not buy them anything either, otherwise, what’s the point.  If they want their job back after losing it, they must put in an application explaining where they went wrong the previous time and what they plan on bringing to the table this time.  Applications are subject to review/scrutiny.

For the record, neither of them have lost their job yet.

The benefit to the two week pay period is that they learn how to budget their money to cover both weeks.  Of course it has happened that they blew all of their money in the first week only to want something in the second week and not have the cash for it.  Ah Ha.  Lesson learned.

What we have found is that it didn’t take long for them to figure out the value of money, savings, and budgeting.  They have impressed me with saving money for a trip.  Versus spending it on crap that they never play with twice.  The new system has them jumping up to help us unload the car full of groceries when before it always seemed like a fight.  Among other things of course.

We are not perfect parents and our kids are not perfect kids so your mileage may vary.  However, if you are running into the same things that we did, it might be worth a shot.  And if you do, or even if you don’t, I would love to hear what worked for you and yours.  I promise to share it with the masses and give you all of the credit.  After all, we are all here to learn, myself included.

Dave

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