Advice for Parents - Making Allowances

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	Feature: Making Independent Choices Some wise advice for parents from financial expert and author, Paul W. Lermitte. *You Let Go When You Taught Them to Ride a Bike. Why are Money Issues Harder?* *Money is a complex commodity,* especially when it intersects with our family relationships. We earn it and try to use it wisely - providing for our kids is a responsibility and a joy. But when it comes to teaching our kids what to do with it, emotions kick in, and we want to be in control. We don't want to let our kids choose. "If you buy that, you'll be sorry," we warn them. "Don't spend all your money on one thing…save a little too." As parents, we need to find a balance when it comes to teaching our kids about spending money and making independent choices. We can give our kids general guidelines and then teach them to make good choices using those boundaries. For example, when you give out your child's allowance, make some rules about how it can be dealt with. Suggest that 25% be put into the piggy bank or a savings account. Another ten percent can go toward some charitable cause, such as the SPCA or your place of worship. Your child is left with 65% of the original amount for spending. Now if you get all picky about that 65% - what they can do with it and what they can buy with it, it's likely that you will start to hear them complain about the other 35% as well. If you can let go and allow your child the freedom to spend their money the way they want to…on candy and treats, toys or the movies, they will learn some valuable lessons at the same time. Some of those lessons include the difference between quality and quantity, and the power of making a poor choice. The quality vs. quantity issue becomes very clear when your child buys a cheap toy at the dollar store, and it breaks before you arrive home. It's also emphasized when he saves up to buy a very expensive shirt and then spills mustard on it the very first time he wears it. When your child makes a choice that she is very sorry about a week later, she learns the dangers of buying impulsively. An example might be spending her savings on an expensive pair of shoes that don't really fit, but can't be returned, or buying pricey nail polish in a colour that looks funny once it's on her nails. These lessons teach our children the benefits of making decisions carefully, and taking the time to do some research. On the other hand, if you constantly interfere…("you can't buy that dear, it has pieces missing, you'll get tired of cleaning out the cage, those baseball cards won't be worth anything a few years from now"), you will rob your children of the experience of learning from their mistakes. Wouldn't you rather they learned these things as children, when relatively small amounts of money are involved, rather than as adults with much larger stakes? Part of the parenting process is helping our children to learn from their mistakes. So next time you hand over that allowance, bite your tongue. Let them make some choices you expect to not work out. When some of their choices turn out badly, it's not time to say "I told you so..." Instead, spend time gently reviewing with your child how this terrible thing happened. Sympathize with how they feel - you've been ripped off at some point too, you know what it is like. Walk through the choices your child had and what they will do differently next time. You'll be teaching your children some valuable lessons! If you are interested in reading other articles about how to educate your kids about money, have a look at some of the links listed below, and browse the rest of Making Allowances for more great ideas and resources. More Web Resources Visit Parenting Magazine for the article Raising a Savvy Consumer Better Homes and Gardens has this article on some How to teach your kids to be good consumers. Ebony Magazine has this article on educating your kids. To download forms that help your family get control of your money habits click here. Return to the makingallowances home page or TOP Site contents © by Paul W. Lermitte	FEATURES

Making Allowances

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Feature:
Making Independent Choices
Advice For Parents on how to teach your kids about money

Some wise advice for parents from financial expert and author, Paul W. Lermitte.

You Let Go When You Taught Them to Ride a Bike. Why are Money Issues Harder?

Money is a complex commodity, especially when it intersects with our family relationships. We earn it and try to use it wisely - providing for our kids is a responsibility and a joy. But when it comes to teaching our kids what to do with it, emotions kick in, and we want to be in control. We don't want to let our kids choose. "If you buy that, you'll be sorry," we warn them. "Don't spend all your money on one thing…save a little too."

As parents, we need to find a balance when it comes to teaching our kids about spending money and making independent choices. We can give our kids general guidelines and then teach them to make good choices using those boundaries. For example, when you give out your child's allowance, make some rules about how it can be dealt with. Suggest that 25% be put into the piggy bank or a savings account. Another ten percent can go toward some charitable cause, such as the SPCA or your place of worship.

Your child is left with 65% of the original amount for spending. Now if you get all picky about that 65% - what they can do with it and what they can buy with it, it's likely that you will start to hear them complain about the other 35% as well. If you can let go and allow your child the freedom to spend their money the way they want to…on candy and treats, toys or the movies, they will learn some valuable lessons at the same time.

Some of those lessons include the difference between quality and quantity, and the power of making a poor choice. The quality vs. quantity issue becomes very clear when your child buys a cheap toy at the dollar store, and it breaks before you arrive home. It's also emphasized when he saves up to buy a very expensive shirt and then spills mustard on it the very first time he wears it.

When your child makes a choice that she is very sorry about a week later, she learns the dangers of buying impulsively. An example might be spending her savings on an expensive pair of shoes that don't really fit, but can't be returned, or buying pricey nail polish in a colour that looks funny once it's on her nails.
These lessons teach our children the benefits of making decisions carefully, and taking the time to do some research. On the other hand, if you constantly interfere…("you can't buy that dear, it has pieces missing, you'll get tired of cleaning out the cage, those baseball cards won't be worth anything a few years from now"), you will rob your children of the experience of learning from their mistakes. Wouldn't you rather they learned these things as children, when relatively small amounts of money are involved, rather than as adults with much larger stakes?

Part of the parenting process is helping our children to learn from their mistakes. So next time you hand over that allowance, bite your tongue. Let them make some choices you expect to not work out.

When some of their choices turn out badly, it's not time to say "I told you so..." Instead, spend time gently reviewing with your child how this terrible thing happened. Sympathize with how they feel - you've been ripped off at some point too, you know what it is like. Walk through the choices your child had and what they will do differently next time. You'll be teaching your children some valuable lessons!

If you are interested in reading other articles about how to educate your kids about money, have a look at some of the links listed below, and browse the rest of Making Allowances for more great ideas and resources.

More Web Resources

Visit Parenting Magazine for the article Raising a Savvy Consumer

Better Homes and Gardens has this article on some How to teach your kids to be good consumers.

Ebony Magazine has this article on educating your kids.

To download forms that help your family get control of your money habits click here.

Return to the makingallowances home page or TOP

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