• 4 Pocket Allowance

What do you mean there are taxes?

Updated: Aug 4, 2019

In our early allowance days, I remember our kids trekking off to the dollar store, with a couple of dollars in hand, and coming home with less than expected because apparently $2 worth of treats does not cost only $2 at the checkout. They were getting a firsthand lesson in the reality of taxes.

Now to be fair, I have let them believe in Santa and the Tooth Fairy for as long as they wanted to. But I see no reason to shield them from the reality that taxes exist.

I have used taxes as a bargaining chip - I made a deal with my son that if he saved the $400 for a new video gaming console, I would cover the taxes to reward him for his diligent savings.

I also try to couch taxes in a positive light. They will have all their adult lives to resent taxes. But I point out to them all the things around us that taxes support - our roads, schools, health care. And I explain that the money for those things has to come from somewhere.

Now, taxes are second nature for them. When saving for a new toy, they get out the calculator and figure out the real total (bonus - they are learning real-life applications of math!!!)

What do you mean there are taxes?, Ideas for parents about allowances and teaching kids about money and financial literacy, #4PocketAllowance

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