Tuesday, March 15, 2016

Let Youngsters Struggle With Money Choices

Today’s fantastic family finance article is:

Money Choices


Parents often wonder: “What’s the right amount of allowance for my youngster?”

The answer is: any amount that forces the child to make choices.

Want versus need.

Near term versus long term.

Status versus substance.

Fleeting versus enduring.

If an allowance is so plentiful that a child can routinely choose A and B, it’s too big.

If an allowance is so meager that a child never gets to choose between A or B, it’s too small.

If a child has to regularly struggle between choosing A versus B, it’s just right.

The key concepts here: choice, ownership, trade-offs.

You’ll know it when you see it. Adjust your allowance accordingly.


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