One lesson that today's parents must learn is this:

We give our kids more by giving them less.

The biggest problem kids have these days is a general attitude of entitlement. So many think, "I deserve whatever I want, and I want it now - without having to work for it or wait for it." Allowances exacerbate this kind of entitlement mentality, robbing our kids of motivation, initiative and creativity.

One Saturday, years ago, my kids lined up outside my bedroom door with their hands out. "Give us the money, give us the money." It was like opening the window at a welfare line.

I began to realize that these kids made no connection between work and reward, that they only understood something for nothing. "Allowance" itself is a welfare term. "Here is your guaranteed amount - here is some of my money that I am allowing you to spend."

Most of today's parents had jobs outside the home when they were kids - mowing lawns, babysitting, paper routes and the like. When my wife and I ask audiences at our speaking events how many had jobs while growing up, almost every hand goes up. Then, when we ask them if their kids have jobs like this, hardly a hand is raised.

Kids are busier today, and in many cases, jobs outside the home are less safe. So we need to find ways to make our families work like little economies where kids have certain jobs they do for the welfare of the family, thus earning part of the money that comes into the household.

Set up a family economy where kids have certain simple jobs that they keep track of themselves (try using a pegboard or chart that parents can initial). Then, on Saturdays, have "pay day" instead of allowance day. Have a family bank (a big, impressive wooden chest works best - with a big lock on it). Give kids old checkbooks and check registers with which to keep track of their deposits and expenditures, putting money in the family bank with a deposit slip and taking it out by writing a check.

Have the family bank pay interest so there is an incentive to save. Make it so your kids can earn more money than they would've received for an allowance, but turn over purchases of toys, games or gadgets to them. Then, when your children ask for things, you can answer, "Sure, if you have enough money saved to buy it."

The best jobs in the family economy are things that must be done and that benefit the whole family - cleaning the hallway, the family room or the porch instead of a bedroom; doing dishes or even getting homework done before dinner so parents don't have to nag about it.

Once kids have "their own money" that they have actually earned, their whole mentality changes. Now they have an incentive to save. They begin to understand delayed gratification. They can give their own money to good causes and feel the joy of contributing. They can learn from their own mistakes. They can make purchase decisions and learn to budget and look for good deals. They can feel the independence of beginning to meet their own needs and buy their own things. All of this is made possible by their earning within a family economy, and all of it is impossible when they are entitled to allowance handouts.

How early can you start kids on this kind of system? We suggest the 8th birthday as the time a child is qualified to join the family economy and become a member of the family bank.

Of course, realize that you are the best expert on your own children, and create a system that will work for your family. The key is to have a plan wherein your kids can learn to earn, save, budget, give and spend wisely. Help your children feel the motivation of real ownership and responsibility.

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