Loving your new book, but I have a question. If a child does not want to spend their accumulated ‘Splurge’ money, isn’t that effectively another form of savings? I am trying to identify the more important lesson. Is it the realisation through experience that splurging can result in the impulse buying of random, insignificant items or should it be rewarding the decision not to splurge at times and having that money to top up their savings?
Congratulations on doing the jam jars!
You’re well ahead of most parents, who do pocket money for a while and then let it fizzle out, and give up.
Getting your kids to dish their pocket money into three jars teaches fundamental life lessons:
The ‘Smile’ jar teaches them the power of saving up for something that makes them smile.
The ‘Give’ jar teaches them the joy of generosity, and breaks the entitled bratty mentality some kids have.
The ‘Splurge’ jar teaches them how to spend their money wisely and enjoy it.
(The biggest financial fear that I have for my kids — having the Barefoot Investor as their dad — is they’ll be so focused on money that they’ll become tightarses. I don’t want to raise stingy, money-hungry kids. There’s a fine line between “8-year-old Johnny’s such a good saver, he won’t spend a cent!” and “28-year-old John is such a tightarse, no wonder he doesn’t have a girlfriend”).
So, Joanne, I’d encourage your kids to splurge some of their money. Yes, they’ll make some mistakes, as we all do. But then again, that’s how we learn, right?