Gifted Issues Discussion homepage Forums Parenting and Advocacy Kids & money

dd is only 5 so I only have limited experience, but it sounds like we are on par with most others.

We will move to Portia's model around age 10 - hopefully by age 17 DD will be responsible for all of her expenses.

In the meantime she gets $1 per year of age not tied to chores, so much as being helpful. She then has the chance to earn cash for over and above jobs (cleaning up her baby brothers mess etc)

I think first figure out what you want to teach and go from there!

This is an interesting topic!

Our view is that each member of the family has jobs to do to keep the family running. This includes income generating work as well as non-remunerated, but equally important, tasks for the household. DDs primary job is doing well in school and she also has chores to do around the house.

In exchange for being a member of the house, each member gets a monthly allowance for personal purchases. This allows each of us to get the things we want without a lot of discussion or negotiation.

DD12 receives an allowance which is $1 per week per year of age. This is for gifts, personal purchases, snacks / Starbucks when shes out with friends, music, makeup etc. Wants basically. We don't specifically pay her for grades or chores though because with our little future lawyer we'd never hear the end of the negotiating. Instead, if she does a bad job (which at this point is more likely to be "forgetting" chores rather than bad grades) she can be penalized by losing allowance.

This year we got her a checking account and a check card for that money. If she overdrafts (which she has not because she's very careful) she has to cover it. We also started giving her a specific clothing allowance in savings. I still buy coats and boots, but she buys the rest (she's a much better shopper when it's her money). This has greatly reduced the stress of shopping with her because if she wants to spend her whole amount on one cool item, that's her prerogative. Gift money (from grandparents typically) and earnings (babysitting) go into her savings. It tends to build without her noticing until a trip or something else large she wants.

We do still buy things for her from time to time without insisting on payback. Books, for example, but it's a surprise and gift rather than an obligation.

Funny that I've not met anyone irl who has a similar pocket money scheme to us yet it seems common on this board. Guessing others don't have to worry so much about negotiations/ have kids capable of operating on this type of model

How did you go about that? I've been contemplating that for the future but it seems like the kid has to be 16 or 18 to qualify. Does she write an actual check or is it a debit card?

Our family is just kinda weird when it comes to money, I guess. No allowance, but all clothes, food, and basic necessities are paid for. As are occasional treats, and field trips. No one ever really goes to the mall with friends or sees movies, so I guess that's a moot point, and clothes are just...clothes.

I don't really think about it, but I guess the way it ends up is that discretionary spending is just fairly low for us. However, we do spend money on larger things like summer camps without expecting reimbursement. So...there are few things asked for and, therefore, they are just paid for BUT there isn't any allowance or anything. On the other hand, they get a lot of cash gifts instead of presents, but the money usually (unprompted) goes into the bank.

However, the question becomes what will happen when the want arises for a car, or something more objective.

I don't know if it's got anything to do with giftedness or not but there's always a certain...reluctance in my family to spend money. It's not exactly being cheap, it's just... I don't know. Maybe we're just overthinking or overanalyzing but we don't spend money on "unnecessary" things without a lot of internal questioning. I don't really know how to describe it.

We have opted to sell one of our meticulously maintained 8yo family cars to DD16-- on a structured payment plan that will last two years, but will result in her having a paid-for car that belongs to her on her 18th birthday-- AND the pressure of having a large, structured loan. Well. Large for her. The concept of "regular monthly payments" was pretty intimidating.

She was very concerned, in fact, and ELATED to have landed a summer job that will cover the entirety of this year's payments.

As long as her grades are good, we'll cover her insurance and will help with gas.

This way-- she's driving a VERY good car (safe and reliable), and she isn't paying anything like market value for it (we're selling it to her for 1/5th of its Bluebook value).


She's had her own bank account since she was 12.

My kids are only 6 and 8. So far the only thing is when you are 7 you get $2 a week paid fortnightly. They usually get a $20 voucher or note from their father's parents at Christmas and birthdays as well. I will give a small voucher if ds8 is saving for something. Ds6 still has the $5 someone gave him on his 5th birthday so I haven't been asked for anything by him.

With regards to the OP's question. Your offer to give part of the scholarship money was generous. It is reasonabke to expect your children to want to assist in paying for activities if the opportunity arises. Scholarships are intended to make things more affordable and I assume if you could easily pay the whole price you wouldn't have asked her to apply.

One of the most tax-efficient ways to subsidize youngsters is to lend them the money to put in a Roth IRA once they have earned income: Should Your Child Open a ‘Kiddie’ Roth IRA? . They can pay you back when they are working full time.

It is this way here too. There is also a Parental Bank where if you leave savings on deposit rather than spending your allowance right away, you earn compound interest (at a higher rate than banks now offer, to make it visible to the child). This encourages saving.

Bostonian's Roth IRA idea is excellent advice.

I think our standard is most in line with aeh's. We don't give allowances and we would never pay for grades. Our kids rarely whine or try to negotiate, because that drives me insane (ds13 has probably negotiated the most, perhaps because he's 4th and I wasn't as good at nipping it in the bud, lol??). We have two adult children who are both doing a great job of budgeting/paying for what they need, so it has worked for us. From the beginning, our philosophy was that they needed to do things because - because they are part of the family, because they should care about their grades, etc. We are not big spenders or gift givers. One dd got her first smart phone at college graduation, one got it after. Only one owns a car (bought by herself when she was working after college), although we lent 2nd dd one of ours when she needed it. One has a TV, one still doesn't. My older teen has a phone, but younger doesn't. Neither has a laptop, tablet, tv, iPod, car, etc. We're not poor by any means, but our priority has been having one parent at home, paying for college, etc... My kids are very money conscious, but not in a paranoid way, in a good way. Older dd had all tuition paid for, and we paid room and board. Younger dd had about half tuition paid. She finished college in three years because she didn't feel comfortable having us spend money we didn't have to, even though she might have liked to go abroad, take additional classes, etc (she did already have a double major/minor/honors certificate). We didn't ask her to do this, but she did. We are very open and honest with the kids about how much we make, what our expenses are, how we make financial decisions, etc...I think they see us being good money managers and they do the same. That said, they absolutely know that if they need anything, really need anything, we are there for them. I imagine we will be financing some of 2nd dd's move across country for law school, and when the 13-year old car we had lent her started having troubles, we gave her one of our two newer cars and kept the faltering junker, since dh has the option of bus/train to work and she doesn't. We have also paid for enrichment classes through AoPS, summer camps, private music lessons, etc.. although I will say that when the kids have won partial or full scholarships, we never discussed whether they'd keep the money or contribute (it was just assumed by all that they would contribute to the cost). I think most kids today get way too much money and way too much stuff.

I just called our credit union and they set it up. It's a custodial account, so we are ultimately responsible, but it's her own account number with a checking and savings. She could have checks, I guess, but we just gave her a debit card that she can take to the ATM or use as a Visa. I also have a credit card with a low limit (we typically use it for safe online purchases, that kind of thing) and I got a card with her name on it (it's still our card though and attached to our credit). This is expressly a "to be used only in an emergency" card (if she ever got stuck someplace and needed to grab a cab for example). This has never been used so far but she's entering the realm of class trips and activities outside our direct supervision.

Camps, classes, lessons, etc. come out of the household fund at this point and we have discretion on what we can and will pay for. As she gets older, this might change depending on what she's requesting.

I have to say that this reduced the amount of negotiation and bickering a huge amount. If she wants to blow her allowance on starbucks and expensive lipstick, she can... but will have to give up something else later. These are teaching her lessons in a way my lectures never did.

DeeDee, I love the parental bank idea and may incorporate that into her savings account (at the end of the month, I could transfer an additional x% into the account as interest).