Raise a Thrifty Kid
">The ABC's of Allowances does offer some general guidelines that may be helpful.
Experts do generally say that your child's allowance should not be tied to family chores. Rather, they suggest that your child's allowance be a fixed amount, with opportunities for them to earn more by performing specific household tasks.
Once your child is receiving a regular allowance, many financial experts suggest using the One-Third rule when teaching them how to manage their money:
- 1/3 of their allowance can be spent right away, for immediate gratification.
- 1/3 of their allowance should be put away for short-term savings, so the child can learn to plan for bigger expenditures like video games, bicycles, etc.
- 1/3 of their allowance should be put away for long-term savings, like education.
Teaching kids about money can be as simple or as complicated as you and your children want to make it. And while every child may not be born thrifty, parents can still help their child acquire the knowledge and skills he or she will need to thrive in a commerce-driven world.
(Links updated: Dec.8, 2001)
The copyright of the article Raise a Thrifty Kid in Thrifty Living is owned by Donna Dunn. Permission to republish Raise a Thrifty Kid in print or online must be granted by the author in writing.
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