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One of the most common questions modern parents have about money is how to help their kids without making direct cash loans or gifts. The dilemma has been around for a very long time, and people approach it in a variety of ways. Figuring out how to navigate the situation can go a long way toward helping youngsters learn the value of money. The tactics take multiple forms, with moms and dads gearing the solution based on the age and maturity level of each child.

For younger children, it’s simple enough to pay them for performing household chores and special tasks. When youngsters approach their mid-teens, they are old enough to learn the fundamentals of budgeting, taking on part-time jobs, and saving for a used car. The parental role is a vital one when it comes to showing kids how to deal with and value the money they have, whether they’ve earned it at work or received it as a gift from a relative. Review the following ways of giving financial assistance to children without directly handing them cash.

Pay For Chores & Special Jobs

Be careful with allowance policies. Never pay children for household chores that they should be doing as part of their ordinary duty. Many families take turns doing dishes after dinner, performing routine house cleaning work on weekends, and keeping their individual bedrooms clean and neat. Let kids know that they are to do those kinds of jobs without pay because the work is a family duty.

For allowance, ask them to do things above and beyond the ordinary, like cleaning the garage once per month, mowing the lawns, organizing boxes in the basement and attic, or raking leaves every other day. Young children are quick to make the connection between those extra chores and money in their pockets. Don’t be surprised if they ask for more jobs to up their income. Every now and then, they agree to assign extra duties so they can build up a small savings account and learn to value money.

Cosign on a College Loan

When teens are headed to college, it’s tempting for dads and moms to pay for everything, assuming they can afford to do so. But sometimes, the most instructive strategy is to sit down and have a long talk with soon to be college students and explain that you’re willing to help them gain approval on a loan application. Thousands of parents serve as cosigners every year for their college-age children who apply for private loans. Your signature can improve the chances of getting funding they need to cover all the educational costs.

For most youngsters, having no credit or financial history makes it nearly impossible to borrow money on their own. Cosigning is a great way to give a helping hand to your kids without paying the bills directly. The approach teaches them to value money and be responsible for paying it back when the time comes. Making that connection between borrowing and owing is a crucial one. Youngsters who learn it early in life are more likely to be successful in their careers.

Don’t Charge For Rent or Food

One of the most effective ways of providing financial assistance without giving cash to your kids is not charging for room or board. Of course, the method works best for older teens who are residing at home during college or the first few months of their after-graduation job while looking for an apartment. What they save by avoiding two of life’s most substantial monthly expenses can add up fast over the course of several weeks.

When older children ask about living at home during a period in between jobs or between school and a first job, let them know that you won’t charge. But consider setting a specific time limit on the arrangement. Otherwise, they’re likely to assume they can stay if they wish, which would defeat the entire purpose of offering temporary financial help.

Teach Budgeting Basics

It’s up to you to decide when to teach your daughters and sons about monthly budgeting. Usually, youngsters are ready to absorb the lesson when they are in their early teens. Don’t use the family budget as an example. Instead, find an online resource with teaching tools that range from simple to complex. Begin with a typical household budget for a single person just out of college. Let them know how relevant the example is for them as you move through the lesson. Some kids are fascinated by the process, while others are bored stiff. Either way, work with the example lessons until they understand the fundamentals.


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