But at around age eight, your child may want to open a small savings account and begin learning what banking's all about, from filling out deposit slips to reviewing statements. You may also want to consider rewarding your child for sticking to a savings plan by matching or adding to the child's contributions. If this works, pretty soon your child may be reading the business section of the paper and not just the comics and sports. Also check out mutual funds that cater to young investors by permitting small investments and focusing on kid-friendly companies. And if you're uncomfortable having your child make investment decisions with real money, consider picking stocks you can track using play-money and then working up to the real thing.
Jobs can teach kids to be responsible and to enjoy earning and saving money.
This could mean cleaning the garage or babysitting a sibling on a Saturday night. Author and family finance expert Neale S. Godfrey encourages parents to maintain a list of non-urgent jobs a child can do. One topic of debate is whether it's OK to pay for basic chores around the house, such as cleaning up the bedroom or taking care of the dog. But many others believe it's only reasonable to expect children to help out as members of the family. They also say an allowance is for teaching money management, not for bribes or punishment.