How Do You Teach Your Child Money Sense?

I wish money grew on trees. But it doesn’t. My kids think we have a never-ending supply of money just to fulfill their wants and desires. But we don’t.

In my view, teaching the kids to be smart with money is one of the most important skills I need to teach my kids. Fail at this, and my kids will be unhappy adults, and so will I.

I have relatives who have never learned how to be responsible with money.  They got sucked into credit cards and “get rich” schemes. Not a year goes by without one of them asking their elderly father for some amount of money.  I certainly don’t want that in my future.

So how can I teach them?

I have been giving them each a $20-a-month allowance. It’s been great. When they are “dying of hunger” at Target, I say, “Sure, we can get something to eat, but you need to use your own money.” Suddenly, they aren’t nearly as hungry, the whining stops, and I save money. My son bought $20 worth of raffle tickets at a Cub Scout meeting. I think he was the only kid that at that meeting who didn’t win a prize. Tough lesson, but better now than when he’s 21 and goes to Vegas for the first time.  Now he only buys $2 worth of raffle tickets at each meeting.  

How do you plan on teaching your kids about money? I’m thinking about giving my 8 year-old a check register with $2,000 in it and letting him pick which activities he wants to do next year. I’m not real sure if it’s good idea. What if he doesn’t want to do the things I want him to do?

What do you think?