Growing up, school taught me how to spell words like hippopotamus; that 2×2=4; that Pluto is the farthest planet from the Sun (that’s how old I am?); and that in 1492 Columbus sailed the ocean blue. What school did not teach me is how to save money, how to set up an IRA, how to budget, or how to calculate interest on a loan. It’s kind of strange to think about. We teach children important facts in school so they can grow up and get good jobs. But once they get that good job and get paid for that job, we leave them to their own devices. That’s not always a good thing. Because of this, it’s very important to teach children about money in the home.
We’ve chosen to teach our children these principles by making them earn money through chores. I know there are many opinions on children and chores. I’ve heard that children shouldn’t be asked to do chores. I’ve heard that children should be asked to do chores but not be paid. I tend to disagree with both these philosophies. I believe children need chores to learn how to work; and they need compensation so they can learn what it means to earn something and save. My husband and I have given this a lot of thought and this is the method we’ve come up with.
When we first came up with a chore chart, we told our kids they could earn a set amount each week if they did all their chores. If they didn’t, they’d earn less. This didn’t work out so well for us. We decided we needed to be more specific. That’s when we came up with the Nickel Chore Chart.
Now we have a chore chart with each chore listed on the left and each day listed across the top. Really I just wanted an excuse to make a spreadsheet to satisfy my OCD tendencies, but it’s working well for us.
Each time one of our kids does a chore on their chart, they get a check mark. Each check mark earns them $0.05 (yes; we’re a little cheap). This way they can see the benefit of doing each chore. At the end of the week, we tally up how much each has earned and pay out.
Here, we don’t let them run off with their money and have a hay day at the dollar store. We have set requirements for their money, to help them learn how to save. Half of everything they earn goes into savings for college, etc; and half is for them to spend however they choose.
We like this method for a number of reasons. One; they learn hard work and compensation. Two; they learn how to save money (and why they need to save money). Three; they learn how much work is required to get the things they want. For example, my son told me he was going to buy an Iron Man action figure with his money. I said “Let’s see how much you earn and then see if you have enough.” I knew he wouldn’t earn the $19.99 required to buy the Iron Man in one week, but I wanted him to learn that lesson. And the end of the week we had a good talk about saving up for the things we want.
When we started the chore chart, we sat down with the kids and asked them what chores they thought they should do. It’s nice to give them a say in these things. We also started out small with just a few chores and gradually added to their lists.
I’m sure our methods will change a bit over the years and as they get older, we’ll teach them more lessons about money, but with small children, this works great for us. How do you teach your children about money?