To be completely honest, I am struggling with the question of whether I should be forcing my kids to save or not. As it happens so often in parenting, the issue of natural consequences vs. discipline is debated. In most cases I usually find some sort of middle ground between telling my kids what to do and letting them find out the “hard” way. But what is the middle ground in learning to save?
I know some parents who require their children to save a portion of their allowance, gift money, or earnings either in a true bank savings account or piggy bank. While I certainly agree with this sort of discipline, as even adults need to force themselves to save, I worry it doesn’t allow enough flexibility. It doesn’t allow a child to experience the consequences of not saving: the disappointment of not having enough money left to buy a special item or attend a certain event.
In turn, I know many families where no requirements for savings are set and the children continue to spend like maniacs. Somehow the natural consequences are simply not sinking in. They still aren’t learning to save.
So, this leaves me wondering… is there a middle ground? Some way to teach our kids the basics, but leave room for some floundering?
When challenged with this question, I decided to create a merge of these two extremes. For my kids, they are allowed to do what they want with their allowances. As they only receive a small amount each week, if they want any sort of significant item they do have to save. My oldest is starting to figure this out. She even brings a notebook in her pocketbook to keep track of items she wants to buy and how much they are.
Then, when extra money comes in – for example, being paid a wage for work, money made at a garage sale, presents – I have a rule that half of that money has to go into a savings account.
What I like about this system is they have a choice for the consistent regular money they receive, but for unexpected or special money, they are learning the technique of saving a portion. At the very least, this process creates some middle ground for natural learning and being directly taught how to manage money.
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