Both of my kids are at an age where the question of allowance comes up. I have a 4 year old son and a 6 year old daughter who are learning to become consumers. I was shocked to find out that girls at her school are already getting all “brand namey” when my daughter came home from school and asked for a pair of Sketcher’s Breeze. My husband and I have made a point of explaining to our kids that commercials between their television programs are companies trying to sell their products to kids, and to look at these “mini shows” featuring toys, cereal or candy with a critical eye. I also suffer from wanting to get the one toy for my kids that will be the magic bullet that will keep them entertained for long stretches of time without me having to break up a fight or be involved in order to eek out some precious “me” time. There is a lot more cool stuff out there than when I was a kid, and I love cool stuff. The request for a pair of Sketcher’s Breeze made me stop and think. I have no good reason to buy her a pair (she has 3 pairs of sneakers already), and yet she wants them. Because I love to shop, I would normally just go out and buy them but that wouldn’t be, teaching her anything about working towards a financial goal.
I had heard musings about allowances not being a good idea, but when I researched online, I found almost universal agreement between financial planners, banks, parents and children about the learning value of an allowance. If our kids are going to make financial mistakes (and they will), don’t we want them to happen when they are dealing with $20 and not $20,000? The current line of thinking is that an age appropriate amount should be given on a regular basis to your children after a discussion has taken place about what the allowance is for. For example, as parents, it is our job to provide the basics of food, clothing, shelter and some entertainment, but if my daughter wants those shoes, over and above what she needs, she can buy them herself. In addition, there are different ways kids can use their money; save, spend or share. If you really want shrewd, financially savvy kids, teach them to put aside10-20% of their allowance into savings. Obviously, they are going to want to use the money to buy things for themselves, and they must be allowed to make mistakes. After buying cheap toys that break after one use, junior will quickly become a shrewd spender. Finally, you want to teach your kids the value of charity and community involvement. I enjoy taking my son to visit the cats at the SPCA. Each time we go, we stop at a pet store to pick up kitten food, or toys, or extra litter boxes to take along with us. I give the item to my son to hand into the SPCA and he looks forward to this simple act of making a contribution. Likely, your children have a passion. For my son, it is animals. For my daughter, it is learning. Teach them that they can use their money to benefit an organization that parallels their interests.
Lastly, it is important not to link allowances to chores. Don’t make receiving an allowance dependant upon chores done. When living in a family unit, all of us need to contribute in order to keep the household running smoothly. These are chores that we all have to do, including the kids. If a monetary value is placed on chores, the kids could choose to forego their allowance because they don’t feel like doing chores for that week. Having said that, if your little one is saving up for something big and wants to earn money faster, many sources recommend offering them jobs that go beyond normal household chores, like cleaning out the car, mowing the lawn, weeding the garden, sweeping out the fireplace, etc. Agree on a monetary value for this service ahead of time and be sure to pay them promptly so that they can learn the association between working hard and acheiving a desired goal.
The value of allowance is determined in a few different ways. Some websites suggest one dollar per year of age. Others suggest basing their allowance on that of their peers. Still others recommend estimating the amount that you are currently spending on “extras” and giving that amount each week. A really great piece of advice was to have your kids keep track their spending by recording the date, what they bought and the cost of the item. I was thinking that I would like to try this as well; although it may be frightening to closely examine my spending habits. Good financial mangement can and should start early. Maybe if the US was better at collectively managing money, the current debt situation might not be so desparate.
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Posted in Education, Money |
The Commonwealth Scientific and Industrial Research Association (CSIRA) out of Australia is a world leader in the science of biofumigation; using plants that are naturally toxic to bugs, as green manure. This technique avoids or limits the use of pesticides that can make people sick. The Third International Biofumigation Symposium, hosted in Canberra this year, has just wrapped up. Countries from around the world shared their research into various methods of using green manure as an alternative to pesticides. Plants from the Brassica species, including horseradish, mustard and rape seed contain isothiocyanates (ITC’s), the compound responsible for imparting the Brassica species with their trademark “hot” flavor, are toxic to certain soil pests and pathogens. Not only is this technique healthier for us, but its low costs and increased crop yields really benefit third world countries who are struggling to produce enough food for their people.
