JrsDad
recently joined
Reged: 03/09/11
Posts: 1
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Opinions Wanted: How can we transfer our children’s energy from wanting to buy every single little knick knack and toy, to becoming a saver, investor, etc?
#735993 - 03/09/11 03:56 AM
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This may be kind of a stretch, my kids are only 8 and 10, but it bothers me to see that saving is not really a skill that is taught or respected anymore. When I was a child and received my allowance it was always accompanied by “make sure you put some of that in your savings” or the good ol’ “don’t spend it all in one place”. Nowadays, these values are non-existent it seems.
My kids get their allowance and spend it all in one place, after telling them the same things that my parents told me.
I guess my question is – How do you start to instilling financial responsibility into your Children? At what age do you feel that they can comprehend this concept?
Thanks in advance.
-A concerned dad
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Goodmom
Pooh-Bah
Reged: 06/17/07
Posts: 2006
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Re: Opinions Wanted: How can we transfer our children’s energy from wanting to buy every single little knick knack and toy, to becoming a saver, investor, etc?
[Re: JrsDad]
#736000 - 03/09/11 06:19 AM
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My kids are free to spend their allowance where they want. They just better not expect me to buy every little toy or gadget that they want. That's what their allowance is for.
Both of my kids will go for weeks where they spend everything. And then they will save for a big item that they want and I refused to buy for them.
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lauramc27
newbie
Reged: 01/15/11
Posts: 43
Loc: Oregon
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Re: Opinions Wanted: How can we transfer our children’s energy from wanting to buy every single little knick knack and toy, to becoming a saver, investor, etc?
[Re: Goodmom]
#736036 - 03/09/11 09:50 AM
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My daughter doesn't get an "allowance", I need to start that, but when she get B-day or Christmas cards I have her pick which ones she wants to keep the money from and the others are put into her savings account. This is done before she opens them, so if she decides to keep the card from the Grandparents and it has $5 and the other has $10 she has to put the $10 into her savings.
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DedicatedDad
veteran
Reged: 09/05/04
Posts: 1318
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Re: Opinions Wanted: How can we transfer our children’s energy from wanting to buy every single little knick knack and toy, to becoming a saver, investor, etc?
[Re: lauramc27]
#736133 - 03/09/11 05:48 PM
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My kids were required to save 50% of all their money until they got jobs, and those were all turned into savings bonds as enough money accumulated. They have about $4500 between them.
Now that they have jobs, they put a lesser percentage, but they do it on their own.
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Eve
member
Reged: 11/28/05
Posts: 112
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Re: Opinions Wanted: How can we transfer our children’s energy from wanting to buy every single little knick knack and toy, to becoming a saver, investor, etc?
[Re: DedicatedDad]
#736881 - 03/15/11 08:13 PM
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I read this a long time ago. It is suppose to teach the value of money without you saying anything to your child.
Whether the child receives money from an allowance or from birthday or Christmas gifts, it is divided into 3 envelopes, with each envelope getting 1/3 of the allowance or gift. So, if a child gets a $3.00 allowance, $1 would go in each envelope.
The first envelope contains immediate money to be spent anyway the child desires and whenever the child desires. The second envelope can also be spent anyway or time the child wants, however, it cannot be spent until it has $25.00 in it. (or any amount you set) The third envelope is for long term savings, and can never be spent. That is investment money.
The idea is that the child will see just how fast money will go if they keep spending the money in envelope #1 without letting it build up at all. They will also see they cannot buy much with a little bit of money, so they will try to wait before spending the money in that envelope so they have more to spend.
The second envelope teaches the child that it takes quite a while to build up $25, or whatever amount you set, so when they finally do have the amount in the envelope necessary for them to finally be able to spend it, they are more careful what they spend it on. Sometimes waiting for it to go over the necessary amount to get what they want, because they have seen first hand just how long it took them to build that envelope up to the amount needed to spend it.
And the long term envelope lets the child see just how money can grow, and how long it takes to have a substantial amount. Maybe for every $25 in that envelope, you could add $5.00. (interest, so to speak!)
This does take some oversight from the parent and carry through.
Edited by Eve (03/15/11 08:21 PM)
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finz
Carpal \'Tunnel
Reged: 06/17/08
Posts: 6453
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Re: Opinions Wanted: How can we transfer our children’s energy from wanting to buy every single little knick knack and toy, to becoming a saver, investor, etc?
[Re: Eve]
#737103 - 03/18/11 04:08 AM
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I like that 1/3's idea Eve.
Jrsdad.....give the kids the money and saving lecture again, they give them their allowance and let them spend it foolishly, then bring them to a store that has something they would REALLY want or a cool excursion they might like (an anticipated movie or a trip to an amusement park) and have them not be able to get that treat because they have already spent their money, THEN start the 1/3's method.
I have heard of the1/3's thing with 1/3 to spend, 1/3 to save, and 1/3 to give to charity....but I don't love the 1/3 to charity part. Not to sound totally cheap, but I don't donate 1/3 of my income to charity. In my family, we stress the service part of charity.....that they should volunteer their time to help others. They can start giving money when they start making it on their own.
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2KidsLA
recently joined
Reged: 04/05/11
Posts: 1
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Re: Opinions Wanted: How can we transfer our children’s energy from wanting to buy every single little knick knack and toy, to becoming a saver, investor, etc?
[Re: finz]
#739570 - 04/05/11 11:20 AM
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These are seriously thought out answers. I like the envelope idea. I've read about people using jars, old school. We have a site called Kidworth.com that is an online version. Our kids figure out where they want to spend money -- DVDs/Toys/T-Shirts/Games, etc. We plug in how much each thing costs, then figure out what they can afford as money rolls in. We add "envelopes" for charity (I agree with Finz, 30% is too much, we do about 5%) and college savings, too.
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