Go Ask Mom

Go Ask Mom

Recession proof kids

Posted June 13, 2010

I remember the exact day my seven-year-old learned about sales tax. She wanted to spend part of her allowance and realized when she got to the checkout aisle that things cost more than the price tag. We had a brief conversation about it and she said to me, "Mommy, it sounds like you need to pay me sales tax on my allowance!" I thought, smart girl... but that's not how it works.

I've been trying hard to teach my children about how to handle money for what seems like a long time now. Call it a mom's mission to make her kids recession proof! One of my biggest fears is that when they grow up they will put their future at risk by living way beyond their means.

Early on, we established a weekly allowance for them. For now, they get an amount equal to half of their age. For example, my seven-year-old gets $3.50 -- you get the picture. In exchange, the girls must help out around the house. Larger dollar amounts, say a birthday gift from grandma, goes into their savings accounts.

While we do our best to encourage them to save, save, save, it seems like they just want to spend, spend, spend... especially their allowance. We try to steer them toward making responsible purchases such as a book over a toy. We really discourage them when they want stuffed animal number 598 or yet another package of costly Silly Bandz.

I'd love to know what other parents do to encourage good money habits. Allowance? Savings? Piggy banks? Investments? And what about giving? I'm sure most parents would agree, it takes constant work to teach children financial skills, but the payoff is worth more than dollars and cents.

Aysu Basaran is the busy mom of three girls and assistant news director for WRAL-TV.

4 Comments

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  • aysutv2 Jun 16, 2010

    I love your suggestions. I'd like to encourage more "saving" and "giving." "Fun money" is a neat concept too. Thanks! Aysu

  • marla6110 Jun 15, 2010

    We teach our children to give 10% and save 15%. The other 75% they are free to spend (as long as its not frivolous) any way they like, but if there is something they want (Video Game, Car after they get their license, etc.), they have to put part of the 75% aside for this as well.

  • haley3 Jun 15, 2010

    My Dad created a virtual online bank for all five of us kids. On this bank, we can split our money into different categories, such as spending, savings, and giving. Our allowance is automatically deposited into our spending account at regular intervals, and then we can choose to put it into savings or giving. We are encouraged to save our money, and since we can see it adding up in our savings account over time we are more willing to save. You can set up your family's own virtual bank right now at FamZoo.com, and watch a video of how it works at: http://www.youtube.com/user/famzoodotcom

  • abswitala Jun 14, 2010

    Struggling with the whole allowance thing because the money is so necessary in our family budget. We've agreed $1 a week is what we can afford to give our 11-year-old and we give ourselves as a couple just $10 "fun money" per month. Hard to budget on that, but trying!