Dear Susan,

My grandchildren are 4, 6, and 7 and have been learning the 4 principles regarding money. As grandparents, we have the luxury of paying our grandchildren for doing special tasks with us (such as, weeding the garden). Our dilemma is determining how much to pay them per 10 minutes of work based on their ages. We expect them to work hard and complete their task to the best of their ability. Any ideas would be greatly appreciated. Thanks.

Sincerely,
W

Dear W,

Determining the proper amount to pay your grandchildren requires you to think like a 4, 6 and 7 year-old. They will be thrilled with less. It’s best to start small, less than a dollar, and give the same compensation for the same task — regardless of age. So, the 7 year-old does not get more money than the 4 year-old for weeding for ten minutes.

At this age, coin over currency, is the best way to pay them. The concept of money is too abstract for young children to understand. To help them understand you need to make the money transaction concrete — which, of course, coin is. They can make more choices with many coins and are more likely to use all of the 4 choices — which is the point. You want to see them practice the use of those choices over and over again — until it becomes second nature for them to consider all of their options every time they have money to work with.

One last thought. I get why you are “paying” the grandkids to help with chores. You are trying to give them some money to work with. But, be sure to let them help you for free. They need to understand that helping family is part of the responsibility (and joy) of being a family member — with no compensation.

Regards,
Susan

Susan Beacham
Written by Susan Beacham

Susan Beacham founded Money Savvy Generation in 1999 after almost two decades in private banking and investment management complemented by considerable time teaching at the elementary level.

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