Special Purchase Plan for Kids

Money management is an important family skill and reponsiblity. Previously, I discussed learning to make a buck where we attempted to show the daughter how she could make some money. The lesson did not go as planned but I think that she still learned something from it. Last night provided another opportunity to expand the daughter’s financial knowledge.

The daughter has been envying Heelys – shoes with wheels in the heels – that all the children seem to be wearing. I’ve heard “I want…” too many times in the past two week to count. The daughter realizes that, in our family, gifts only come on holidays and that all the complaining in the world won’t bring the holidays any closer. Also, she knows that she doesn’t always get what she wants as a gift and she should plan to purchase things she really wants. Last night we sat down and wrote up a “Special Purchase Plan” for the Heelys. I wrote the general format and left blanks for her to fill in, sign, and date. It basically stated:

“I want to buy ____________ and it costs $_________.

I can make a special purchase by contributing 50% from my savings account and 50% from my cash on hand.

Current amount in Savings $_________. Current amount in cash $____________. I need to save $__________ more dollars.

I can make up to $5.00 a week doing chores. If I work hard and do well on my chores, it will take me _____ weeks to save up enough money.

I am willing to work hard and save money so I can buy this item. Sign _____________ Date_______”

We went online to check the prices for the shoes. She was a bit surprised to learn that the range in value from $40 - $100 and was interested in looking at the cheaper generic models (yay, she doesn’t require brand name labels). We ended up selecting a pair that cost $60 to use for planning purposes. I explained that she can always spend less or more but it was important to pick a pair, fill in the contract, and get to bed.

She filled in the blanks and signed the commitment to save the money and taped it on the wall by her desk so that she would see it everyday as a reminder of what she is working for. I reminded her of the option of taking additional chores when offered. Many times, in the past, she has opted to skip cash-for-chores in order to read or go out in play.

Hopefully this process will result in an important lesson and a special purchase for the daughter – I’ll let you know in about 10 weeks.