Taking over your kid’s money – is it right?

Remember when you were a kid opening presents and the cards were boring? Remember how much you wanted a present to open and not just a card?  To me they were not much fun, but the reason was because any money I got went straight to my parents to put in a bank account for me for when I got older.  Didn’t seem much fun.  But, I do have to say when I got older it was wonderful!  I admit I am very glad that I didn’t get all those presents to open!

So now here we are.  I am the parent now taking the envelopes.  Why doesn’t it seem as easy as it was back then?  It worked for a few, maybe eight, nine years.  But, then my kids started thinking.  The ‘wants’ now are so much pricier.  I would have been happy with a Blondie Album as a 10 year old.  Now forget it.  It is iPods and cell phones.  They decided they wanted to start ‘saving’ for these things, since they know we won’t be buying them.

Now, reading this it seems so easy to just say, ‘tell them you need to save your money, teach them, and be done with it’.  Not that easy (that is what I thought too, until now).

It is sort of a catch-22.  We want them to learn the value of a dollar.  We want them to appreciate things and not think they can get anything and everything.  So how do we do this?  Do we tell them to save for the future or for things they really want now (instead of 10 years down the road)?

My tendency is to tell them to save for the future (since it really worked out well for me) and I continue to try to do this.  But, in a way I sort of see their point.  They realize the expense of these things, they are not expecting us to buy them, and they are figuring out ways to save their money themselves.  Will this make them appreciate these things more?

So what do you do?  Do you immediately take all of your kid’s money and stash it away for when they are older?  Do you let them figure it out for themselves?  Do you let them buy things with it but only certain things? Funny, my kids get so frustrated with gift cards, because I am usually with them when they spend them…saying, don’t get that, that would be better, do you really want to spend your money on something like that…….I just can’t help it!

{ 23 comments }

liz June 25, 2010 at 10:17 am

When we were young, we got to keep bday and christmas money to use towards purchases we want, but money that came with graduation/confirmation, etc. were “for the future”.
.-= liz´s last blog ..Food Find Friday, Vol. 10 =-.

J. Is a Bird June 25, 2010 at 12:17 pm

Right now our kids are young so we usually take the checks and buy them something special they want. I think it’s nicer for the giver to receive a Thank You note telling them you bought the kid a Talking Thomas train than say “hey, Thanks for contributing to K’s savings account.”.

In the, not too distant, future the deal is this: Gift checks go into the college fund, money you earn (allowance and doing extra chores) can be put away at your choice towards something you want that we aren’t gonna buy you.

This works well both ways: Your thank you note can now say Thank You for contributing to K’s college fund and the giver can feel important AND you’re teaching your kids to work for something. I mean if Grandma gives them a $100 birthday check and they “save” that and combine it with $100 for Xmas, then go out and buy what they want, how is that teaching them anything except WooHoo Grandma?! If you make them save from money they’ve earned and worked for, I feel they learn the value of both money and work.

When I was younger I babysat and paid for my own clothes. Let me tell you I was so proud of the way I dressed because I picked those clothes out myself and paid for them myself. I want that same feeling for my kids too.
.-= J. Is a Bird´s last blog ..Southern California Water Parks: Have you been yet? =-.

mangiabella June 26, 2010 at 1:22 am

when i was young bday money we could spend, any other money was saved – just became your newest follower – would love to have u follow me at mangia-bella.blogspot.com – have a great weekend!
.-= mangiabella´s last blog ..The Sunshine Award… =-.

Tennessee Mom June 26, 2010 at 8:55 am

The week after our son was born, I went and opened his savings account. We contributed randomly throughout the years, but the kiddo wasn’t event aware he had one.

He’ll be 8 in a couple months and we’ve just recently started the chores/allowance thing each week. The agreement we have is that half of all money he gets goes in the bank, the other half he can use on toys, candy or whatever.

(I found you on the Lady Bloggers Tea Party and joined your followers)
.-= Tennessee Mom´s last blog ..Guerrilla Salvation =-.

Deborah June 26, 2010 at 10:25 am

Hi! I’m here from The Lady Bloggers Tea Party Social! Pleased to meet you. I’ve got a HELLO, HANDSOME blog party happening at my blog right now. I’d be tickled pink if you stopped by and joined in the fun.

Deborah
Homemaker Honey
homemakerhoney.com

parenting ad absurdum June 26, 2010 at 11:11 am

I take the money in put it in their college account – but they’re only three and four, so they don’t argue! We’re starting an allowance at age five, so that they (hopefully) learn how to manage small amounts of money, and learn the difference between instant gratification and saving for something special. I’ll let you know how it goes…
.-= parenting ad absurdum´s last blog ..Outrageous lies we tell our children =-.

Natalie June 26, 2010 at 12:18 pm

We’ve decided when our son gets old enough to want to spend the money (right now he’s happy just putting it in the piggy bank), that we’ll make him save half and then he can spend half. That’s the plan now anyways :)
.-= Natalie´s last blog ..2nd Look SaturdayAnd a Few Other Things =-.

Melissa (Confessions of a Dr. Mom) June 26, 2010 at 10:25 pm

I’m facing this question right now. My kids are so young, so up until now we would just let them pick out something special and not save it. Now, as they are getting older, they are also receiving more money…I’m feeling guilty about NOT saving it b/c I feel I should. I like the idea from Natalie about saving half and getting to spend the other half…maybe we should try that.
.-= Melissa (Confessions of a Dr. Mom)´s last blog ..Toys Are For Sharing and Hands Are For Holding =-.

mommymommymommy June 26, 2010 at 10:34 pm

For my fifteen year old, she keeps some and banks the rest, as we make her pay for the very large ticket items she desires. It’s her choice.

My twins get to spend some money, but I bank the rest. They forget about it. Same with gift cards. They will go to a store and spend it right away. If there is a small balance, I keep it and buy things they need with it.
.-= mommymommymommy´s last blog ..Things to Do with Your Kids this Summer-Free and Simple- =-.

Licia June 27, 2010 at 1:12 am

Good question! I hadn’t even thought about this since my kids are too young to decide what they will spend their money on right now but time flies and I’ll have to ask this question to myself. I’m thinking that a combination of strategies might work. If it’s not a lot of m0ney, I guess it can’t hurt if they learn how to spend it. Of course, that means they’ll make mistakes and I’ll have to keep quiet, but it will likely be a much better lesson than if I just say it and they don’t get to experience it for themselves.
Thanks for this post.
Stopping by from the Lady Bloggers Tea Party
.-= Licia´s last blog ..travelling with children =-.

Holly L June 27, 2010 at 2:24 am

We are having this discussion right now. My son just had a b’day and got a bit of money…hubby took it right out of the envelope. My son keep saying but I have X amount of cash and hubby says you can only spend half. I am trying to find a happy medium…because us taking it doesn’t seem to teach him anything. I stink with money(that is why I married someone who knows what to do with it!) so this is hard for me!
.-= Holly L´s last blog ..Tickled Pink No 12 with a Hop- =-.

Kathy June 27, 2010 at 8:07 am

My kids get SO MUCH STUFF from well-meaning people! So cash usually goes to the savings account. Lately though, they keep some cash and bank some cash. That way, they are saving but also learning to spend/budget, too.
.-= Kathy´s last blog ..All McDonalds Restaurants Deserve a Break Today – from Frivolous Lawsuits =-.

Joey @ Big Teeth & Clouds June 27, 2010 at 8:46 pm

Since Julia’s only five her spending is in the $5 to $10 range. I take big chunks of money (to 20s and 50s) and put them directly in a passbook savings account that is in her name. If someone gives her a couple of $1s, I let her save them up to take to Target and buy an occasional treat.

Time will tell how this works when she’s old enough to know what’s going on!
.-= Joey @ Big Teeth & Clouds´s last blog ..Catching lightning bugs before hearing aids =-.

mommymommymommy June 27, 2010 at 8:51 pm

Hi! I am giving you an award on Monday’s post!

Cameron June 27, 2010 at 11:07 pm

I gave you an award on my blog today!

http://www.ingenuemom.com/2010/06/blog-with-substance.html
.-= Cameron´s last blog ..How to Efficiently Read Blogs =-.

Tamara June 27, 2010 at 11:28 pm

Right now, our oldest is seven and our youngest is seven months old. Our oldest wants a Nintendo DSi. We told her she had to save her allowance to get it, so she isn’t allowed to spend her allowance if she wants it. I usually let her use her gift money to buy things then. It’s a treat for her, and I figure it’s birthday just once a year. This might change when she gets a bit older.
.-= Tamara´s last blog ..Easy Summer Recipe – Fruity Chicken Salad =-.

Alexandra June 28, 2010 at 4:37 am

Hi, Dalia!
Always enjoy your provoking posts.

We put the big money in their accounts, and let them keep the petty cash for movies, etc., the local fair, things like that.

But they never get the big dough from bdays and Xmas and the like.
.-= Alexandra´s last blog ..The Pied Piper of Toothville =-.

Betsy @ zen-mama.com June 28, 2010 at 12:09 pm

Great Post! We have helped our children save over. I encourage them to spend a little, too. But mostly they save. They fill out the deposit forms and we go together to the bank. They save for big things, too, like ski passes and exchange trips around the world. They’ve learned a great lesson by seeing that even little bits of money add up fast over several month. Our 19 year old now has his own account that we don’t see at all. I think he’s gotten the saving bug and puts most of his money in his account.

Tennessee Mom June 28, 2010 at 2:30 pm

I’ve also passed along an award to you on today’s blog: http://bit.ly/dBT4Jg

Kate (This Mom) June 28, 2010 at 4:43 pm

Hi there! Just found you through Ingenue Mom and I’m your newest follower!

My girls are only four and two, so I take their gift money. Some goes in the education fund, or towards something we’re buying for them (e.g. my two year old’s birthday money bought her big-girl bed).

Pretty soon my oldest is going to catch on. I did a post about allowances and piggy-banks recently too…kids need to learn, even from a young age, to manage money. But how much do they get, and how much control? I like the save/spend/share piggybank we bought our daughter, because the three compartments make it clear how to allocate the money. The spend money will be for whatever she wants. I guess. Thankfully, she hasn’t asked to spend it yet!
.-= Kate (This Mom)´s last blog ..Organize Hair Accessories – Without Buying a Thing- =-.

Linda at Bar Mitzvahzilla June 28, 2010 at 8:25 pm

I’m over here via KISS.

I’m not much of an ogre with the everyday cash my kids get from relatives for birthdays and holidays, but when my son got Bar Mitzvahed we took all of his money and put it in the bank. I was kind of surprised that other kids were allowed to spend THOUSANDS of dollars! I add to this money, along with some 529 accounts I’ve set up, so that I can be sure that when he turns 18 four years of college will be fully paid for (in state university!) And there’s no “opt out of college/cash option” – the money’s only for college.
.-= Linda at Bar Mitzvahzilla´s last blog ..Midlife- Bad Wife =-.

Aging Mommy June 28, 2010 at 10:08 pm

We’ve not yet reached that stage with our three year old and right now she always gets presents, not money although my Dad has set up an account for her and pays some money in each month to that. My view is that the money in that account and any money she later gets is for her future. If she wants expensive toys before then I would allow her to “earn” them by taking on extra tasks and figuring out ways to bring in some extra cash herself and if she is successful then that money can be used for such things.
.-= Aging Mommy´s last blog ..Who Am I =-.

hangingwithmrscooper July 1, 2010 at 3:46 pm

I let them hold on to for a bit and decide what it is they really want to treat themselves too. There’s always a DVD or a Wii or DS game that they want. Or they might want clothing. That’s why I let them hold on to it for a bit so they can narrow down their decision.

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