How do you teach your kids about money?

My parents visited us this weekend and with them came some early Halloween treats for Anna and Avery — and a five-dollar bill each.
 
Remember back when a five dollar bill held vast material dreams in its faded creases? Not a lowly quarter or singular loonie, but an actual bill. (Though I sometimes feel that way now, when I’m halfway to work and realize I didn’t set aside money for parking and dig around in my bag praying for a fiver among all the change.)
 
I saw Anna’s eyes light up with glee over money for the very first time. She even impressed me with her skills: “That means we could go to the dollar store and I could pick out five one-dollar things, or two two-dollar things and a one-dollar thing, if I bring coins from my piggy bank for the extra change” (a.k.a. tax to you and me). Why, yes, Anna, that’s exactly what it means. But Anna’s urge to purchase is new. Anna has been mostly indifferent to money. When we have a bunch of spare change, we’ll often give it to the girls to divvy up for their piggy banks, but there it will stay, out of sight and out of mind. A couple of times, I’ve told the girls that they could buy a book from their Scholastic forms if they did so with their own money, but otherwise, they don’t really think about money or buying things. In fact, when Anna lost eight teeth in one year, she’d be all excited about the handful of change in a baggie that the tooth fairy left her, but then she’d leave it somewhere and forget all about it. So much so, that the tooth fairy may have repurposed a deposit or two.
 
It got me thinking about what I should be teaching my kids about money at age six and four. I know Anna is learning about money at school. We don’t spend much time shopping together (it just isn’t my idea of fun), so they’re not witness to a steady stream of purchasing from us. I do try to talk about how much things cost and compare them to other things. Avery thinks it’s cool when I price-match at a store. But Anna did show me how little she knows about how it all works one day when I told her I didn’t have any money to buy something and she said, “Just use your card!”
 
I can see why it would be confusing. I tried to explain that to have money on your “card” you have to earn it through your job, then your job pays your bank, which puts money back on your card. But that you had to spend wisely, or your card will run out of money and then you can’t use it until you get paid again. I could see her wheels turning, but I’m not sure how much sunk in. It’s hard in this age of digital finances to help kids really understand dollars and sense, isn’t it?
 
But it’s one of the most valuable things to teach our kids, and you can’t really do that without putting money in their hands and having them make choices and live with the consequences. That’s when it becomes real. And that requires an allowance, which is a road we haven’t gone down.
 
Is six too young for an allowance? According to the experts, it’s just the right age to begin, but for some reason, I’m reluctant to start this common family practise. Probably because of all the other expert advice: I shouldn’t have any say in what she does with the money; I shouldn’t attach it to chores; I shouldn’t use withdrawal of the cash as a consequence for misbehaviour.
 
That all makes sense on paper, but I’m trying to figure out what Anna would do with money except buy junk (the edible or the dollar-store kind) and I think that would make me crazy. She’s still young enough that she doesn’t want clothes and she doesn’t often ask for things, which I appreciate. But maybe it’s time we started an allowance and just see how the dominoes fall.
 
I still have a strong feeling about tying allowance to some kind of chore, though that seems to go against the common thinking. I believe that household chores are everyone’s responsibility, but maybe something like room-tidying or bed-making or general obedience (ha!) could be tied to allowance? See? I can already tell I’m going to use it as a bargaining chip and maybe that’s part of my hesitation.
 
No matter what, it will start a dialogue about money with the girls and help us discover what kind of financial minds they have (yes, both of them, since I don’t see how I could start Anna on an allowance without doing the same for Avery, even though she’s only four).
 
If your kids get allowance, how much (for what ages)? What do they spend their money on and do they earn their allowance?

Photo by kenteegardin via Flickr.