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Archive for May, 2011

Should Your Child Get a Summer Job?

May 31st, 2011 - Category: Teaching Kids to Work

Summer is here. And that means your children are going to want more money – a lot of money. There are movies to see, theme parks to visit, vacations to take, and a whole lot of activities to keep them busy. But unless you are willing to increase allowance for the chores your children are doing, you’ve got to come up with a money solution.

For older children, there is always the possibility of getting a summer job. But are summer jobs worth it? Are they valuable to your child without affecting the way your family functions.

We looked at some of the pros and cons of summer jobs.


Your child learns “real world” responsibility. Even though your child has chores and other responsibilities around your home, there is nothing that can perfectly simulate what it’s like to work a job. With chores, your child can get them done on their own schedule. A job is not going to be so lenient. So it’s great for them to see what really happens.

You aren’t the one forking out money. If you were made of money, you may not mind giving a little more to your child. But most of us are on a budget. And paying your kids $20 to vacuum the floor and take out the trash is simply not realistic. Once your child has a paycheck coming in, they won’t pester you with money quite as much.

You won’t hear the “I’m bored” complaint. One of the biggest challenges of summer time is keeping your kids occupied. There never seem to be enough things to do. But once they have a job, there isn’t as much time to get bored. Which means…less t.v., less complaining, and less needs for money. You could even encourage your child to save some of the cash they’re bringing in.


It could add to your busy schedule. If your child doesn’t have a car, you’ll find yourself driving around a little bit more as you get them to work on time. Plus, if you have younger children at home, you can no longer count on the older ones to help out. The free babysitting just went to work.

Your child may be less inclined to do their chores. Sure, work is important, but so is taking care of responsibilities around your home. And your children should be contributing to that effort. Once your child has a job, they may feel less inclined to do their chores. Or, they may put them off as long as they can. Not only does that develop bad habits, but the benefits of having a job are now offset by the lack of help you get at home.

You see less of your child. As difficult as having your kids at home for the summer can be, it’s also a great time to bond with your kids. Unless a job is imperative, you may not want your kids to get a job.

If a summer job is something you and your children are contemplating, then take a minute and talk through the options with them. Whatever choices you make, just be sure that your family is well taken care of and that your child knows family chores and responsibilities take precedence.

A Missing Piece in the Allowance-for-Chores Puzzle

May 24th, 2011 - Category: Money

Today on MSN, there was a great article that we couldn’t pass up the opportunity to comment on. The article was written by Liz Westin and outlined these three research study results:

-Kids who received allowance were no more likely to save their money than kids who did not.

-Unconditional allowances seemed to be correlated to lower literacy scores and less chances of having work experience before graduating from high school.

-Many kids who receive allowance look at is as entitlement money.

That’s a lot of information to take in. And it really makes you wonder which is better: giving your children an allowance or encouraging them to make their own money. Or does it make any difference at all. Because this seems to be a no-win scenario.

After reading the comments and thinking about the success so many families have had with, we came to the following conclusions:

- Assigning chores and rewarding your kids with an allowance is not enough. Children still need you to teach them critical lessons about saving, spending, and being financially responsible. Sometimes it may be difficult for you to reveal, but sharing some of your own financial burdens with your children will help them understand what it will be like on their own.

- You need to make chore and allowance decisions together. If your children don’t understand the connection between doing their chores and being rewarded with an allowance, they won’t experience that job-salary connection either. Once they’re old enough, sit down with your kids and discuss what they think is fair in both the chores they do and the allowance they receive. And let them give some input about the types of activities/purchases they should be responsible to pay for.

- Reinforcing financial lessons will always be a good idea. You are going to have moments when your kids come begging for money. Whether it’s to go to the movies or to buy a video game, they will want more money than they’ve saved. You’ve got to decide how you will handle those situations and what lessons you want your children to learn. It will be difficult to stick to your guns but there are lessons to be learned.

- Realize that circumstances will change. Be aware of your children and the changes they are making in their lives. What works this year may not be the best solution next year. Especially when your children get more involved in school and with friends.

- Consider not giving cash as allowance. How else are you going to give your kids their hard-earned money, right? When you deposit money into a saving account or use a system like, your children have to really think about what they want before spending their money. Cash is too easily burned through. With, your kids have the option of saving, saving for something, spending, or even giving some of their money to charitable causes. And you get some insight into what money decisions they’re making.

The article we read today did make us pause. Obviously every parent wants to make sure they aren’t wasting money on their children. And they’d like their children to learn great lessons. With the tips we shared, we feel confident you can make good decisions and be pleased with the results you see in your children.

How to Prepare Your Kids Financially for Summer Break

May 17th, 2011 - Category: Money

It’s almost that time of year again. The time when your kids are home from school for three whole months. While you may enjoy having your kids around more, it could end up being exceptionally expensive for you.

With all that time off, your kids are much more likely to:

  • Go to the movies (3 or 4 times)
  • Hit the local swimming pool
  • Play a few games at an arcade
  • Find time to visit an amusement park

And don’t forget the family trips you’ve got planned. It can really add up. But unless you want to listen to your children whine about being bored, it’s probably a good idea to talk to your children about what you can and can’t afford.

Here are some ideas for making that family discussion go a little bit more smoothly.

Be honest about your circumstances. Children can be more understanding than you may expect. And telling children now what you’re able to afford saves you from being badgered later down the road.

Discuss your summer plans. If you are planning a family vacation, let your children know. That way, they can save their chore money for souvenirs and you won’t have those last minute arguments when they want to buy a bumper sticker or stuffed animal. Giving them an idea of how much things cost would be a good idea as well.

Offer them alternatives. Instead of a night at the movie theater, you could borrow the neighbor’s projector and create an outdoor theater on the side of the house. Something out of the ordinary may satisfy their need to “do something” and keep you (and them) from spending a lot of money on entertainment.

Encourage summer jobs. If your child is old enough you should encourage your children to make their own money. If they start now, they might be able to secure a few lawn mowing jobs or get a summer job as a lifeguard. This will teach your children a few great financial lessons…and keep them occupied for the summer.

Give them extra chores so they can make extra money. You know you have projects that have been waiting months to get done – like cleaning out the closets. Knowing your children will want extra cash, give them an opportunity to earn it rather than just giving in to their requests.

Ask them to help you save for the summer. If you put a plan in place during the year, you could have a penny jar filled with possibilities for the summer. Teaching your children to save (even change) during the year will show them the benefits of being money-savvy.

Your summer should be just as enjoyable as your kids’ summer. Talking with your children before those summer holidays begin is a great way to make sure you are working together.

Enjoy your break!

Who Should Teach Kids Financial Responsibility?

May 9th, 2011 - Category: Financial Literacy

During a recent conversation, one woman was heard to say, “I didn’t know what I was doing when I got married. I had no credit. I didn’t have a car. And I didn’t have a job. Neither did my husband. We made a lot of financial mistakes that we’re still paying for.”

The woman’s father, another participant in the conversation, replied, “Well, they just don’t teach those kinds of things in school anymore.”

Hold on a minute? Isn’t it up to parents to teach their children financial responsibility?  Why should schools pick up the slack when parents fail to teach even basic money matters to their kids? Math taught in schools – great! How to acquire great credit – not realistic.

But in all fairness, finding the time to teach these principles to your children can be difficult. And you probably wouldn’t want your children to:

  • Help as you pay the bills
  • Know you are living paycheck to paycheck
  • Worry about how much they cost you every year
  • See the financial mistakes you’ve made
  • Get the wrong impression about how much money you have in your accounts (even $1,000 looks like a lot to a 12-year-old)

Most parents are not going to reveal their own financial situations to their children. Understandable. Nor are they going to sit down and spend an hour reviewing financial responsibility. But there are many things you can do to help your children learn to manage their money even at a young age:

Give Them a Goal – once upon a time it was difficult to buy a home or car. Adults saved their money for years to make significant down payments. When that changed, so did the economy. And not for the better.

Saving for something you want is a great way to learn financial responsibility. So, even if you can afford it, don’t buy your children everything they want. Help them save their cash until they can make their own purchase.

The benefits of working toward a goal include: learning patience, evaluating needs versus wants versus momentary desires, and developing self-control.

Restrict Their Purchases – give a young child $5 and they are likely to spend the entire thing on candy. Although you may feel like an ogre telling them they can have one candy bar (instead of 10), it’s a lesson that needs to be learned.

But don’t just stop them. Take a minute to talk about it. Let them know that 10 candy bars today might mean they don’t have the money to go to the local swimming pool tomorrow.

Let Them Pay Their Own Bills – when your child wants private lessons or a 16-year-old wants to borrow the car, you have a chance to teach them the realities of life. Have them pay for their own lessons or car insurance. A monthly payment made to you will teach them about the recurring nature of bills.

Sure, it’s okay to help them out with their payments once in a while, but make sure they understand that they should always have money ready to pay their bills the following month.

Add Some Interest – how often do your kids ask if they can “borrow” some money? Your first reaction might be to say no. But maybe next time you can teach them a valuable lesson. Instead of just giving them the money, let them know they will be charged interest for any amount they borrow from you now.

If they borrow $10, let them know you expect to be repaid $11. They will holler about how unfair you are but what better way is there to teach children about loans and interest rates?

Be More Open – as your children grow, consider being perfectly honest with them. Let them know how much you’re paying for your car each month. Tell them about the time you purchased a new computer and then didn’t have the money to pay your power bill.

So many economic challenges could have been avoided if people (as a whole) were more financially savvy. Being reserved about your own financial matters will not help your children learn. They need to know what to expect once they step out on their own.

At, children learn how to manage their chores and manage their money. The online system gives them the chance to save, spend, and donate based on criteria you and they determine together. If you’re not using it already, we encourage you to sign up for a free account today.