If you ask me, one of the biggest lessons that we as parents can teach our kids is to be financially responsible. Although financial responsibility sounds like the title of an undergrad college class, I can assure you that teaching it is easier than it sounds.


Think of it as transitioning from role-playing cashier with the toy cash register to transferring the skill of counting money by splitting their allowance into the 4-bank system. Here's how it works:

First, you'll need four clear jars (you could use pencil cases or even resealable bags) and label them: save, spend, donate and invest. To make this easy on you and fun for them, pay them their weekly or bi-weekly allowance with one-dollar bills or quarters.

The key for this system to work for them (and you) is to make this a routine. Pay them on the same day every week and address dividing the money right away into the four jars.

Save. This is one opportunity to talk about goals and the concept of saving for the future. Also, that money grows not on trees, but by being mindful of how much we can set aside every time we get paid.

Spend. This is money they can spend on anything they want. Within reason, that is – their spending must follow your rules! Some lessons you can teach are what happens if they spend it all at once versus spreading it out to last until they get their next allowance payment.

Donate. This bank teaches the importance of helping others. It's also a way to start a conversation about what causes they could support. It can be as simple as giving to a community food drive, a pet shelter or buying school supplies or toys for less fortunate kids.

Invest. This bank is all about teaching them long-term savings, like paying for a special trip in a few years or their first car. You could also add, let's say, a quarter per month to teach the concept of earning interest to teach them how real savings accounts work. (Or just open up an account at your bank for your kids.)

Yoly Mason, a blogger living in Orlando, Florida, wants to live in a world where Latinas can enjoy an abundant life with a small budget and where being in debt is as out of style as the rotary phone.

Image ©iStock.com/michellegibson

Topics: family  finances  latina moms