Kelowna Financial Advisor Gives Kids’ Allowance Tips

November 23, 2011

Being a Financial Advisor in Kelowna, I’m often asked for advice when it comes to family budgeting and money decisions.  One of those money decisions revolves around pocket money for the kids.

Young kids are often given a loonie or twoonie and left scratching their heads and wondering what to do with it. (Candy! Candy!) Remember, kids can imagine some very unusual ways of spending their money. So what’s it going to take to teach them on how to use it wisely then?

With so much in our hands most of the time, we definitely need some professional help in taking care of our financial plans. Trained individuals like a Kelowna Financial Advisor could be the answer to that. This is the person to run to for advice, tips and strategies considering this new phase that we have to go through with our children.

Simply put, a parent’s influence on each developmental milestone can either “make” or “break” the child’s general perception on a lot of things. What the kids are going to perceive as the correct thing to do is the way they see mommy and daddy spend their cash.  As challenging as it may sound, that’s how things are going to be when we become parents.

 

Piggy Bank
Photo by Penny Mathews

 

Now let’s try to use some common sense into this. Every parent has this natural instinct on what to do when it comes to their kids’ needs. Here are some things your instincts will tell you when initially teaching them the value of money:

 

  • Don’t easily pull money out of your pocket every time your kid asks for some spare change.
  • Ask probing questions like:
    • What do you need this money for?
    • Do you really need to buy it?
    • Is it too important that you really have to buy it now?
  • Always show them that you’re setting some money aside as “your personal savings”. Get that cute little piggy bank if you have to, just to show them that you’re saving up for something
  • Give them a set amount weekly.  Having a fixed $4 or $10 will force them to budget and prioritize, just like adults.
  • Let them do some extra chores and negotiate the pay rate.  Throw in “performance bonuses” if you want to introduce more advanced ideas.
  • Try not to let them see you splurge! Parents are entitled to do some splurging sometimes but you can do that in your own “alone” time.
  • Don’t forget the importance of charity and donations – school fundraisers are the obvious place to start, but kids often think that parents automatically give money for school activities.  Let them see that you support non-school efforts too and help them understand why you do it.

 

Have more questions about family finances?  Finding a good Financial Advisor in Kelowna is one good place to start.  As a Kelowna life insurance and financial planning company, Your Future Financial Group has proven to be a great resource for families from all walks of life. We have expertise in life insurance, health insurance, investment planning, RESPs, RRSP Consolidation Loans, and tax-efficient business strategies.



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