Teaching Our Kids Financial Responsibility

 As a CPA, I have insight to both good and not so good financial decisions.
Start teaching your children about money when they are young.  When your kids are old enough to understand your instructions, let him or her hand the cashier money and get the change.
A small allowance at an early age teaches young ones what money looks like.  Your child will learn to count and how to make change.  It also teaches responsibility and that there are consequences to decisions and actions.
Older children can manage a larger allowance along with the responsibility for paying some of their costs (i.e. school lunches and incidentals).  With a weekly allowance, your child can learn the concept of not spending it all at once.  If they receive a weekly allowance, which must last for the whole week, they will learn very quickly the need to budget their daily spending in order to have enough each day
Teenagers ask for money for other things.  They want money to go shopping, money to go to the movies, or to go out to eat with their friends.  This is when it gets more difficult.  A monthly allowance in addition to the weekly allowance may be a good choice.  Some kids start to buy their own clothes at this time.  A monthly allowance should be enough to pay for their clothes and additional incidentals.  Have your kid prepare a budget.  Then use their budget to determine the amount of allowance they receive.  It is important to periodically talk to them about how they are using their money.
Teenagers are old enough to learn about the cost of their sports, school, after school programs, religious and other activities you pay for.  Share with them how you budget and pay for their activities.
College is a big step.  This can be a difficult transition, which is made even more difficult if they do not have a foundation of financial responsibility before they get to this point.
When your children leave your home to enter the world on their own, they will make better decisions if you have provided them with a good financial upbringing.
Jerald Schneider is a Certified Public Accountant providing tax, accounting and financial advice for more than 25 years.  He can be reached at 661-297-1072 or by e-mail at jerald@jeraldschneider.com.