Making Allowances

We have decided to start giving Lily an allowance. Mind you, it is not a very big one and it is still "fun money." I gave her $4 yesterday. We haven’t decided if it is going to be $4/week or $4/month. We may settle on something like $8/month. Either way, the idea is to start teaching her about money. She has two envelopes and a piggy bank right now. One envelope is labeled "GIVE" and that has 50 cents of her $4. She put $2 in her piggy bank. She has $1.75 left over in her "SPEND" envelope. What happened to the other quarter? We don’t know and neither does she.

I hope that this exercise will start to give her an idea of what it means to save money. Right now all she sees is that if we need or want something we just go to the store, select the item, scan a card, and take it home. We were at Toys R Us on Sunday and she had her eyes on the animatronic pony that reacts to your touch. That pony happens to cost about $240. She of course wanted us to buy it, but now I think I can give her some perspective. At her current rate of income with pocketing $2 of saving money each week, it will take approximately 120 weeks or a little more than 2 years for her to save enough money. It might give her some perspective to think that she would be 6 years old before she could buy it. We’ll keep you posted on how it goes.

Eventually, the goal is for her to learn how to manage her money more comprehensively. We may end up buying her a car, but it will be indirectly through her allowance. Someday she will be in charge of buying her school supplies, her clothes, her lunches, etc. Obviously this won’t happen anytime soon, but it is down the road. This way she can decide if she really wants one nice pair of new pants or 6 pairs that she can get at the thrift store, for example. We’ll see how it goes.

Noah has been really fussy the past couple of days. Amanda said that he was really biting on his spoon at lunchtime. I ended up taking Noah and Lily out for a ride after dinner just to get them out of the house. A half hour of solitude for Amanda is certainly worth a gallon of gas.