Over a year ago, I purchased a LearningCents Bank for Jack. The bank features Save, Spend, and Give cylinders in which kids deposit their allowance each week. This process helps teach kids the important concepts of money.
Since Jack is six years old, he receives an allowance of $6/week. His responsibilities include filling the dog dish, cleaning the play room and tidying up his bedroom. Granted, it is not much, but he IS six after all. Naturally, the older he gets the higher the allowance (7 years old = $7/week, etc.) and the more duties required.
When he gets paid his allowance on Sunday, $4 is placed in his “Spend” cylinder, $1 is placed in his “Save” cylinder and $1 is placed in his “”Give” cylinder.
Clearly, saving a portion of his allowance will teach him discipline in controlling his spending habits. Hopefully, he will designate this money for future investments like college, a car or even an investment portfolio. Look out Warren Buffett.
Occasionally, we will be shopping at Target (for example), and will ask for a toy. I will remind him that he has his own money and that he can pay $10 for this item. There have been times when Jack will rethink his desire and pass on the purchase. The spend money he has earned will also buy presents for his family for birthdays and Christmas. He handles the cash at checkout and is responsible for collecting change (under the watchful eye of daddy).
Recently, I’ve been thinking about the money Jack has accumulated in his “Giving” cylinder. We talked about how lucky our family is and showing compassion for others who are not as fortunate as we. Since it is Christmas, I spoke with him about buying toys and giving them to Toys for Tots. Since buying a toy for another child leads to another trip to the toy section of a number of frequented stores, Jack sees this as a win-win situation. Another consideration was the bags of food you can buy at the grocery store which donates food to underprivileged families.
Regardless, we are starting the process of social responsibility.
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