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Como preparar a sus hijos para manejar el dinero inteligentemente: Mensualidad

How to Raise Money Savvy Kids: Allowance

by Allison Kane

One of the most effective ways to teach children how to manage money is by giving them an allowance.  An allowance is a sum of money allotted to someone for a particular purpose.  The allowance first originated in the United States during the 1830's and its main purpose was to encourage fiscal responsibility. 

Although giving an allowance is a great way to teach your children about fiscal responsibility, it isn't an easy process.  There are many factors to consider.  For example:

Q: How much money should you give your child? And how often?

A:  The standard rule in setting an allowance is to pay $1 per year of age.  For example your 8-year-old child would receive $8 while your 15-year-old would receive $15.  Since there are many factors to consider when establishing an allowance, including family finances, this rule is not set in stone. As for how often your child should receive an allowance, once a week is pretty standard. 

Q: Where should your child keep his/her money?

A:   A popular place for young children to store money is a piggy bank.  With this small safe a child is able to put dollars and coins into it and have direct access. However a thought to consider is that direct access isn't always a good thing.  We all know young children love to steal things that they don't have from their siblings, so it is possible that piggy banks aren't safe for storing money. In this case it might be wise for parents to keep their child's money in an envelope and when the child needs the money, they can ask for it. As for older children, investing in a wallet is a great way to keep money safe inside/outside the home.  Another place a child can save money is at the credit union in a savings account created for kids.

Q: What if your child spends their allowance too quickly?

A: As we know, children can overstep the limits, so don't be surprised when your child makes mistakes when it comes to spending money.  Let your child spend $50 on clothes or $30 on fast-food.  Eventually they will realize they should have used that money for other purposes. The main purpose of an allowance is for your child to learn about the balance of spending/saving money, so let them make mistakes.

It's important that we teach our children how to be more money savvy because it teaches them about the value of money but more importantly it teaches them about holding accountability for their own actions.

Published 6-20-2011

 

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