Summer is over and the living is no longer so easy. School has started and we will be running until winter break. None of us needs another thing to think about right now.
Instead, let's review what we already know about how to teach our kids about money. Here's a list of do's and don'ts to remember.
Keep up with allowance.
Allowance is how you teach your child money management. Once you start, keep moving forward. As you peel off those crisp dollar bills, remind your child about the four choices they have: save, spend, donate and invest. Insist they pay themselves first and put some money in "save" and suggest they consider the donate choice. The money left over is to be used for the expenses that are now their responsibility, invested or budgeted for a larger future goal.
If you forget a month (or three, as I did recently), don't stop. Once you start the allowance process, your child will be hooked.
If you are behind, pay it all in one lump sum. Show them you keep your money promises. This will translate to an adult who does the same. Bottom line: fess up, pay up and start again.
Review the allowance contract.
Since kids' needs change, their allowance should change with them. For example, children face different expenses during the school year than they do during the summer. And as kids grow, their expenses do, too. This month, sit down with your child, review the contract and make any necessary changes.
Print a year's worth of allowance contracts in advance and give them to your child to execute. Hand them over, along with the responsibility for presenting them for signing and payment. This way, the allowance deadline is driven by your child. Since they have a vested interest in making sure this gets done, let them manage the process.
Talk about money choices.
Once your child is older, the ways money can be used to their advantage grows. All of a sudden, the child who willingly donates is wondering just why he needs to give so much. One of my daughters had this very issue recently and asked just how her donation to church helped her. We had a long discussion about how the money was not meant to help her, but to help others.
This conversation was a bit of a defining moment in her education about what it means to be a good steward of God's resources.
Forget to review the allowance rules.
I remind my daughters that no money changes hands until receipts from the previous month are reviewed. They remind me that allowance is due on the first of the month. Fair enough. Everybody should take a moment to review the rules.
Lose track of saving.
Allowance dollars add up. Help your child set a savings threshold. When it's reached, help her research other savings vehicles with greater returns, such as a short-term certificate of deposit.
Forget to put everything in writing.
Once you and your child have a deal, put it on paper and you both will win. Even if the deal goes sour for one of you, the problem will be easier to work out if both parties are clear about the terms.
Delay talking about long-term goals.
What's coming up in your child's academic life? Will she need a special outfit for a first dance? Sports equipment to play on a team? These opportunities require joint planning. Don't wait until it is too late to talk about how you and your child can manage extra expenses. Over dinner, make a list of potential expenses and brainstorm a money plan.
Stop allowance once your child gets a job.
Instead, pick up the pace. Consider doling out bigger sums spread over a greater period. Rather than monthly payouts, start giving two months, then three and so on until your high school senior is managing a years' worth of expenses.
It's easy to let allowance slip when schedules get complicated. Prevent this by taking a moment now to remind yourself and your child of all the progress you have made. Add a few do's and don'ts of your own and start the school year with the confidence that just a few moments of review and preparation will help carry you through the inevitable rough spots this fall.
Susan Beacham is the founder and CEO of Money Savvy Generation, a financial education company that provides innovative products and services to help parents and educators teach children the skills of basic personal finance, www.MoneySavvyGeneration.com. E-mail her at Susan@MSGen.com.