[thezoid]

Earning money is one thing. But teaching someone how to budget has drastically better chances of using their money more effectively.

Besides, once they get old enough to work (maybe throw in chores) they'll already have plans on what they want to do with the money that goes beyond drinking, games and consumer goods.

[jaxn]

The key is to require the kids to make purchasing decisions.

Our kids (ages 12, 11, 9 & 8) are required to purchase all of their own school supplies, clothes, activities, etc. They earn the money from us and can earn a lot, but they have to complete their chores without us asking and turn in their peg slips (like a time sheet).

They then have to decide, do they want the $80 jeans or the $20 jeans? If they buy the $20 jeans then they can make more trips to the skatepark.

It works really well. Our system was derived from the book The Entitlement Trap: http://www.amazon.com/The-Entitlement-Trap-Choosing-Ownershi...

[jtbigwoo]

>> They then have to decide, do they want the $80 jeans or the $20 jeans? If they buy the $20 jeans then they can make more trips to the skatepark.

What seems important is the willingness to let your kids make mistakes. When I was a kid, my parents had a set budget for each of us for clothes. My sister was super interested in clothes from an early age so they just gave up and handed her the money. She'd shop sales and make extra money to get everything she wanted. On the other hand, my parents basically dictated the clothing I would buy. (Every fall I got three pairs of Levi's jeans, four new shirts, two pairs of dress pants, two dress shirts, one pair of shoes.)

I never got the chance to buy one pair of $100 jeans instead of three pairs of $35 jeans and then have to figure out how to get through the week with one pair of jeans that fit. I learned to handle money in other ways, but I think my parents missed an teachable moment.

[icebraining]

Requiring them to purchase school supplies seems counterproductive, unless they really value them. If my brothers were given a choice, they'd buy the shoddiest possible equipment to save money for fun stuff, and if you were to force them to buy better things, you haven't really gave them the purchasing decision, just faked it.

[daeken]

That seems like a great way to learn that you get what you pay for. Letting kids make mistakes (especially relatively minor ones like that) is always good.

[gizmo686]

The problem is that kids often under-value their education. As such, they would allocate less of their money to school supplies then they should. They may not realize this mistake until they realize the value of education, by which point it may be to late.

[jaxn]

They receive a list from the school and buy what is on the list.

In general, we do have to tell them what to buy sometimes.

[jaxn]

Do you think an expensive pencil performs better than a cheap pencil? What about folders, glue, notebooks, graph paper, etc?

When we get into electronics, the school list specifies which graphing calculator to buy. Will my kids find a used one on ebay? Probably. Will a used one perform worse?

It is an interesting concern, but we haven't had a situation where their frugality has gotten in the way of their education. One of my kids likes fancy mechanical pencils, another one uses wooden pencils until they are nubs. It's their choice :)

[icebraining]

Pencils, folders, and such, not that much (though the cheapest paper is usually to thin to withstand the treatment), but I've seen math compasses literally fall apart after a month or two of use, dented rulers, pens which would spill to clothes, etc.

It's not that you need to buy expensive stuff, but the cheapest of the cheapest is usually only good for occasional use, not daily school work.

[jaxn]

Fair enough.

We haven't run into those issues. They tend to order their supplies off Amazon, but I don't know much about what they choose or why.

[sivetic]

Absolutely agreed. I've had a job since I was 15, yet I spent all my money (and then some) well into my 20s. It was disposable money and I didn't appreciate budgeting (though I understood the concept well).