Your Kids And Money: Teaching The Value Of A Dollar

Podcast

What's the point of an allowance?

For Ron Lieber, personal finance writer for The New York Times, it's a tool to help teach values and character traits like patience, moderation, thrift and generosity. And Lieber, who's writing a book, The Opposite of Spoiled, about kids, money and values, tells Morning Edition host Steve Inskeep there are three basic ways that parents approach an allowance.

This is the method that Lieber and his wife use. They give their 7-year-old daughter $3 a week, which she divides in thirds. She puts $1 into a "spend" jar to buy anything that she wants, $1 into a "save" jar for medium- to long-term goals and $1 into a "give" jar that ultimately goes to a cause of her choosing. "She spends a lot of time thinking about that," Lieber says.

Transcript
 But if you give the kid an allowance, there's a little bit of self empowerment there because they get to make some decisions for themselves.