15 Money Rules Kids Should Learn

The 15 Money Rules Kids Should Learn

by Jeff D. Opdyke

Monday, March 29, 2010

provided by THE WALL STREET JOURNAL

Teach Your Children Well

1 Spending money happens only after you earn it.

2 When kids start asking parents to drive to the toy store to buy some plastic whatnot, it's time to consider an allowance.

3 The size of an allowance shouldn't be so meager that your child is a pauper among peers, nor so generous that your child can easily afford all wants with little financial planning.

4 Good grades are expected and help around the house is simply the price of family life.

5 While 16 is generally the legal age of employment, encourage kids starting around age 13 to think of ways they can earn an income.

6 Guide and advise your kids about money, but don't dictate.

7 Failure to balance the debit-card bank account monthly means losing access to the debit-card for a week or more; failure to repay an entire month's credit-card balance means the loss of the card until the balance is fully paid off, plus and additional month.

8 Only 50% of the money put into a piggy-bank can be taken out to buy something. At least half must remain inside the pig.

9 Children should have the right to screw up financially, so that they can learn from their mistakes.

10 When it comes to investing in stocks, kids should understand a company at such a basic level that they can draw a picture of the business model with a crayon.

11 You don't need to be wealthy to begin teaching your children about the stock market.

12 If a child's charitable interests lie outside your special interest, so be it.

13 Parents don't have to save every last dime a child will need for college expenses. You only have to save up to your ability or desire to pay.

14 One of the greatest gifts you can give your child is your own financial self-sufficiency when you're old.

15 At some point, you have to tell your kids that the Bank of Mom & Dad is officially closed.