I have had fun times trying to implement what I learnt at Investec’s conversation on raising financially fit children last year. You can read about that conversation here.

So after that function I spoke to my bank about opening an account for my three children. I was reluctant to open one for the youngest, who is two as I felt he was still too young. In the end I opened for him too because I didn’t want to go through the application process twice. Once I got over those hurdles of applying we got our cards. I delayed giving them to the kids because I was in December festive mode.

Money boxes and allowances

In January I got my children money boxes. There was a lot of excitement on this special occasion as the money boxes came with sweets inside, courtesy of the retailer. The money boxes have a lock on them so the kids felt important. They didn’t know that the keys are identical, so I had good laughs when Luyololwethu (Luyo) went to hide his keys.

Luyo and Aya after receiving their first allowance

Each child receives an allowance of R10 times their age, so Ayabulela (Aya) gets R40 per month while Luyo gets R60 bucks. There will be an increase on each child’s birthday. It has been interesting to watch their behavior and reaction towards money since this event.
My eldest takes his responsibilities too seriously and has been “blessing” me with coins every chance he gets. The first blessings came when we went to the butcher to buy meat. He wanted to take care of the entire bill of R249 but only had R10 in his wallet. We settled on a five rand contribution so as to not discourage his generosity.

Afterwards when we went to the petrol station to fill up petrol I found myself without coins to tip the petrol attendant. My son willingly offered me R5. I was pleasantly surprised as there was no expectation for repayment from him. At this point I was worried that his money would not last the month. My daughter Aya on the other hand has been very generous with the Sunday collection. Her brother exclaims so hard when he sees how much she has in her purse for the Sunday collection. I choose not to intervene as I see this project as important for their learning.

The greatest thing about them having their “own” money has been that I have not had to deal with money requests for the tuck shop or ad hoc events at school.

When I gave them the allowance/money boxes I told them that the money was for them to spend on what they like, for the school tuck shop and for the Sunday collection.

Paper Money

Luyo asked me the other day when we would be going to the bank to deposit the money. His question surprised me. The first thing that came to mind was cash deposit fees and the inconvenience of having to physically go to a branch. So I was reluctant to take him to the bank as I also haven’t been inside the bank for the longest time because I use internet banking whenever I can.

I later asked him why he wanted to go to the bank and he mentioned that he wanted to get some paper money.  I had to explain to him that paper money could be found in most places including his dad’s wallet, at the shops and the ATM.  But I made a mental note to include paper money the following month when I give them their monthly allowance.

I have also noticed a change in behavior especially from my eldest when it comes to tuck shop money. He has become disciplined. They have tuck shop every Friday at after-care so he takes R5 with him. I remember an incident last year where his dad gave him R20 for tuck and he used all of it on that day. I need to mention that in East London R5 can get you an ice lolly and a packet of chips.

At the time I was upset with my husband for giving such a big amount for tuck, my son for buying so many items and whoever sold him those things at tuck. But I had to take a step back and place the responsibility at the parents’ feet. We were the problem. Had we been organized about tuck money and agreed on the maximum amount he gets for tuck, that incident would have been avoided.

Related party transactions

Debt collector

It’s also been interesting to observe the money and power relations between brother and sister.
We went to Bubble Jungle (an indoor play area for kids) the other day. The agreement was that I would pay for the entrance fee and the kids would pay for their own snacks. Luyo had R25 while Aya had R10. Aya wanted a cupcake, which cost R12 so she borrowed R2 from her brother.

As soon as we got home Luyo reported to me that Aya had not paid him back his money. I told him that he would have to collect the money himself. I was not about to play Mashonisa (debt collector)’s right hand woman! As soon as I authorized the collection he was on to Aya, demanding the return of his money.

Building net worth

Aya’s first tooth came out the other day and she was very excited to receive a gift from the tooth fairy. She innocently asked her big brother to count how much her fortune had grown. Unfortunately, her tooth fairy gift resulted in her having more money than the big brother. This upset the brother who then resolved not to buy from the tuck shop so that his money box balance would not reduce. And that hopefully Aya would increase her spending, making him worth more than her in the process. Forbes top 10 by net worth here we come!

Building net worth

Towards the end of Feb they had a sausage day at my son’s school. As part of the fund raising they were selling raffle tickets. I overheard Luyo asking his sister to contribute R5 for a raffle ticket if she wanted to attend this event. He used his last R10 to buy two tickets of his own so I was impressed by his wit. I like that the parents are no longer the obvious choice and source of funding.

I have deliberately delayed going to the bank and also giving them their bank cards as I want them to grasp the basics first. They seem to understand the exchange of money for a service or product concept and that money is a finite resource. I also see the mental and physical reconciliations of money that happen after a day of spending.

What I enjoy the most is watching my children being generous with what they have been given. My son has used the pocket money to brighten my days when I least expected it. However I can never get used to being told that “I can afford that” by a four year old when I am saying to no to a purchase at the shops.