making allowances

I don't want to come across on this blog as bragging or trying to look like I have it all together, when clearly I do not.  This has always been (for nearly 10 years now, holy smokes!) a place where I store the things that I want to remember, where I share our experiences, travels, and small victories with our families and friends, and where I can tell myself that I am not doing absolutely everything wrong.  With that in mind, I'd like to share our latest scheme for teaching the kiddos about money.

Over the years, we have tried several different things: just handling the money for them (after all they are pretty little yet,) paying them for doing certain jobs, paying them a general allowance based on a short list of jobs, buying them a thing that they want and having them "work it off" to pay for it afterwards.  But none of these has felt like it was really helping them to develop a sense of earning and saving money in the real world. We also have tried (sometimes) to have them pay 10% tithing on their earnings and this has involved a lot of fiddling with pennies and been dreadfully tedious to keep track of.  But we think it is terribly important that we teach them how to handle money, and so we keep trying to find a better way.

Then in January I read this blog post by a Mennonite blogger that I follow.  It seemed like a workable concept for us, with just a little bit of tweaking. (I made my own simplified account books for each child, we give a 1:1 exchange rate on every currency, and I am the "banker.") The best part of this system is that it involves little to NO CASH.  Just like in the real world.  Ha!

On the first of each month, I write in their allowance as a deposit into their account. They receive the number of dollars that their current age is. We have not implemented her "waiting period" as our kids are rarely in stores and for souvenirs on trips that just isn't practicable. We also have the flexibility of having them pay their tithing when we have cash on us for them to do so (whether that be once every two months or whatever) as we can easily see when they last paid their tithing and help them to calculate what they owe.

I still have a "Jobs for Hire" board that they can access to earn additional funds if they desire as well. And don't think I'm a totally heartless Mommy; we pay for all of their needs- clothing, food, school supplies, etc and do purchase them each one small souvenir when we travel, and ice cream cones, and sports and dance fees, and have lots of fun family experiences. But beyond that, if they want something, they have to pay for it themselves.  (If we keep it up, as they get older and their allowance becomes larger, we may have them begin to pay for some of these items themselves.) With this system I can just pay for it and deduct it from their account.  So easy.

It has been gratifying, especially in the last month, to have some experiences with the kids that show me that they are thinking about money and starting to develop an understanding of what things really cost.  From Jake asking me the price of every toy he sees, and then deciding to NOT spend his allowance because we are going on a trip in a few weeks and he wants to save it for then.  To Charlotte asking me to order her Harry Potter Book 5 on Amazon, because it is cheaper than the price in the store. To Toby, my sweet, mellow, quiet Toby, HAGGLING with a vendor in Slovenia and getting a price lowered from 5 Euros down to 3 Euros.

So, this is working for us, and I thought I would share our little success in case it might help someone else.