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Speaker: Should I give my children an allowance; if so, at what age should I begin giving an allowance?

Janet Bodnar: I think an allowance is the best hands on learning tool there is for kids and this is a very good transition. Once kid starts, say at the age of six or seven, they are starting to learn about money in school. They are getting a little bit more sophisticated about understanding the whole abstract idea of money, so that if they get five or six dollars a week, they now how far that would go. So, I think that's a good age to start and it really covers that whole elementary middle school age. As I said, I think allowance is a great teaching tool. I always say that kids will spend unlimited amounts of money as long as it's yours. When their money is on the line it's a whole different story and certainly for this middle school years, when they don't have a job of their own, the best way to get money into their hands, to get them that learning tool is with an allowance. So I think it's very important. Giving allowance is very important; you don't have to start at the age of six or seven you can start a little later if you would like, but certainly if you do start that young, you can use it as a foundation on which you can build as the kids get older.

Expert: Janet Bodnar

www.kiplinger.com

Janet Bodnar is deputy editor of Kiplinger's Personal Finance magazine, for which she has written articles on a wide range of topics, including investing, money management and the economy. Bodnar is a nationally recognized expert in the field of children's and family finances. Her latest book is Money Smart Women: Everything You Need to Know to Achieve a Lifetime of Financial Security (Kaplan). She speaks More »

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In this video, Deputy Editor of Kiplinger's Personal Finance and author Janet Bodnar answers questions on the many issues surrounding what kids should know about money.

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Tags: Money, Finances, Financial, Banking, Bank, Account, Funds, Allowance, Kids, Children, Child, Parent, Job, Career, Work, Working, Invest, Investments, Investing, School, College, Chores, Expenses, Credit, Debit, Card  

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