My granddaughter won money in a music composition contest and wanted to spend $4 of it on some artificial fingernails.? I accompanied her to the store; being a proud grandfather, I’d like to reward her for winning the contest.? So after she picked out the nails and we walked to the cashier, I offered to pay half.
I figure this way I am transferring income, showing pride, but not lowering the price of fake nails and not giving her an?incentive to spend more on fancier junky fake nails. This little?strategy seems sensible for a one-shot game; but in a?repeated game I know that she will catch on and spend more next time, expecting a subsidy from me.??I like to transfer income, but I don’t want to subsidize specific purchases. I need to cook up a new strategy for the next similar situation.
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Next time, tell her you will match 100% (or 50%) whatever she puts in the bank in a savings account. My parents did it for me when I worked summer jobs cutting the grass, and I will do the same when my little ones starting earning money from small jobs outside the home (lawns, babysitting, etc.). I think it teaches a great lesson and transfers some income.
What you are essentially doing is handing her $2, with which she can do anything she pleases — except, apparently, apply it to her current purchase. She might not waste the $2 on fancier nails, but she could just as easily spend it the next day on candy that’ll rot her teeth.
You could pay for her to have a pedicure to match her new nails. Some related thing to whatever it is she’s chosen to do with her money would be a nice bonus.
I had a similar problem with gift checks from Grandma. The check was for $75 and when they were babies, I would spend the money on coats, clothes and a small toy.
Once, they got big enough to spend their own money, there was no way I was going to let them drop $75 on whatever junk they picked out.
Our policy is only half of any gift money can be spent, the rest is savings. I keep track in a spread sheet of what they have in their account, and how much spending money they have at any given time.
Allowances are $2 spending, $1 savings and $1 for the church. Money made by workings is 50/50 spending and savings.
I want saving to be part of any thought process involving money: being given it, getting it regularly or earning it.
Matching the award (rather than the expenditure) with cold hard cash might better incentivise her to pursue the sort of achievements you celebrate. You might throw her a curve ball by offering to convert every $1 she hands back to you at the end of your shopping trip into $2 (or more) at some well-defined future date or upon the achievement of some goal that builds upon the present success.
You should ask her to pick a stock from the S&P and put her new funds on it. (You wouldn’t actually have to invest the funds, just set up a parallel private account for her; the idea is that she might develop the interest in following the market and investing.)
Or you could have her watch you set up a “Social Security” fund for her and pour the money down a rat hole.
At 10 years old, my grandparents and my parents were all working. I was selling things door-to-door so I could save up to buy my first bicycle and clarinet.
You could offer to pay for her tattoo.
e85 anyone?