The Chores Checkbook       

One of the most difficult things to get kids to do with an allowance is save it. If you give your kids their money in cash, it’s really easy for that cash to go in one pocket and out the other in the form of candy, movie tickets and impulse items at any store checkout line. Trying to get them a real-life checking account is another no-go, even though managing a draft account is one of the most fundamental personal finance skills kids need to learn.

Among the challenges kids will encounter when they get a job and a checking account will be the distance between their money and themselves. Letting go of cash is one thing. You can see the money leaving your hand as you get some good or service in exchange. When it’s swiping a plastic card, though, the distance between spender and money increases. It’s much easier to be impulsive in those instances, and kids without real-life skills in managing money in this way can be quickly overwhelmed, leading to overdraft fees and troubled credit scenarios.

There is a way to get them that experience while encouraging them to save and appreciate value, however. Why not become a “personal banker” yourself? The “First Parental Credit Union” of your house will happily hold money earned for chores, birthday and holiday gifts and other funds (whether or not you choose to offer interest is up to you, the president!). Kids can make withdrawals for purchases when they need to, which also allows you to see how your kids manage their money.

Keeping track of their account balance should be largely their responsibility. The method can be as simple as a piece of graph paper on the refrigerator or as complex as a shared online spreadsheet. You could even get an actual passbook online and let your child design a custom logo!

Each entry should include amount, date and memo, just like a real checkbook. This practice can give them invaluable experience balancing a checkbook and appreciating the reality of digital funds. Keeping track of their spending habits also gives you a common frame of reference when it comes to discussing budgeting with your child.

Keeping a chores checkbook is an easy way to teach money management and responsibility without radically changing the way you and your kids relate to money. It’s a no-risk option to get on the same page with your child for financial matters. Make balancing the checkbook an activity the whole family can enjoy!