Maybe the grass IS greener

The most William and Nick know about money at two years old is that coins make a loud noise when you drop them in a bank.  And if you shake it, MORE GLORIOUS NOISE.

I have absolutely no idea what the right approach is to teaching kids about money.  I've read that paying them for chores teaches them to work for it.  But then I read that chores should be expected and they shouldn't receive monetary compensation for it because that's just an expected part of being a family.  I don't know which is right. 

What we have done for them though is opened up a bank account for each of them.  Any gifts of money they get go right in there.  We also contribute a small amount monthly.  My hope is that they won't blow it all on...whatever it is 18 year old boys blow money on.  I do have one story that I'll be passing on to them.  They can take what they want from it.  Hopefully the message is powerful enough to leave an impression. 

My uncle mowed lawns for money as a boy.  His father took half of his money he earned and put it in the bank for him.  He never touched it.  Through the miracle of compound interest, when he died unexpectedly a few years ago leaving behind my aunt and three young cousins, the bank closed the account and sent a check.  For enough to buy three of the SUVs I drive.  With some leftover for floor mats. 

If you want to see how other people are teaching their kids about money, check out the Capital One blog blast at The Parent Bloggers Network.  Capitol One also has some interactive eLearning tools to help families learn about money management.  Mowing lawns optional but recommended.

Comments

[Eva]

Evidently, receiving money for tasks decreasing people's sense of their intrinsic value. Since I want my kid to clean up/ do what I say/help out just because it's the right thing to do, I won't pay her for it. (At least that's what I think right now). Same with grades. But if other people want to pay her to do stuff (a la mowing, babysitting) that's money she can have, of course.

When people have given her money, it's gone into her bank account. I think she's got 100 bucks now. I'm sure there will be more, enough to buy books one semester at college. :)

[Flicka]

What a great story! When my dad still lived at home before he married my mom but after graduating high school, my grandparents charged him a low rent fee so he'd know what it was like out in the world. Unbeknownst to my father, my grandfather saved all the rent money he got and when my dad got married, he gave it back to him as a check for $2,000. My parents still have the cancelled check somewhere.

[Lori]

This has been on my mind a bit lately too. Not sure how to approach it but I definitely want to teach them early about saving and the value of money. I read an article somewhere and it had a good breakdown of what to teach them at various ages, starting with 3. Now if I could only find it again...

[Kir]

what a great story and a great way to learn about money. I hope that when the time comes we can teach them the value of it and the fun you can have with it to, if used correctly.