Teaching kids about dollars and sense
Posted Nov 15, 2015 10:16 am.
Last Updated Nov 15, 2015 10:21 am.
This article is more than 5 years old.
Having a hard time teaching the kids about money?
Giving them an allowance is a good way for them to learn but it’s how you manage it that can make a big difference.
Ellen Percival, publisher of Calgary’s Child Magazine and calgaryschild.com, advises against tying an allowance to chores.
“As parents we already have enough of a power struggle that we don’t want to add another one. Giving them an allowance is really a teaching experience unto itself; you’re trying to teach your kids how to be more financial savvy and how to have good financial skills and learn how to save money. So, don’t make it be about the chores, make it be about the allowance,” says Percival.
She says many will argue that chores are part of being a family, a team, and that there should be no money attached to them.
So, how much allowance should you give?
Percival says most experts suggest a dollar for every year of the child’s age. An eight year old would get eight dollars a week, and so on.
When it comes to how early you may want to start, she suggests five and six year olds can start to grasp the concept of saving and spending. Percival says, seven to 12 year olds are really in the sweet spot for starting healthy financial habits.
You can also let your child pick a charity and donate to it every few months. Another idea Percival shares is that kids can contribute to a college or private school savings account. Even if it’s only a little bit, they can feel what it’s like to save for important life goals.
