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[quote=Anonymous]Your kids are a little too young for this... but plan ahead. My DD just turned 13.  I opened a "Teen spending account" for her at my bank (USAA).  It is essentially a sub-account with her name on it and she is getting an ATM/Debit card.  I just took her down to the bank and had her deposit all the cash she had been saving from birthdays and xmas presents (from grandparents/relatives).

The Dave Ramsey book (which I don't entirely agree with, but I do on this point) suggested that when kids are 14, the parent should give them the money for the things they need (i.e. clothes, school requirements, etc.) and then supervise the kid in using the account to pay for the things they need/want.  So, I am no longer buying my kid clothes (which is mostly b/c she is so picky and I waste my time and money doing it).  I will give her a certain amount of money and take her to the store and she can pick out and buy what she wants/needs.

I already showed her how to make entries in her account ledger when we made the deposit.  So, I'll help her keep track of her expenses when she starts buying things. The point is to give kids supervision over managing funds and purchases while they are still home.  Then when they go to college, they won't be spending like crazy with no understanding of managing and budgeting.

Dave Ramsey also suggests that kids give you a budget for the things they expect to need before you put money in their account.  My DD is tight with money, so I will see what happens when we shop to help her figure out a budget for next time.  My DS on the other hand, is very loose with money and would probably spend all of his clothing budget on video games... but he's only 10, so I'm not giving him a debit card or account just yet.

BTW-- DD's account is distinct from my account... it's a sub-account, but she cannot get access to the funds in my account.  She has her own pot of money and that's it.  [/quote]

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