Read Clark's Big Book of Bargains for Free Online Page B

becomes $40, and they’ll start to understand the benefits of deferred gratification, as opposed to current gratification. In time, they’ll become dedicated savers.
    Software designer David Hunt has a different approach to this. He created a program called Family Bank (www.parentware.org) that helps teach children ages six to sixteen about money. Parents deposit the child’s weekly allowance in an “account,” for the child to spend and save. If the child needs more, they can borrow money, but they have to pay it back with interest. So instead of getting $10 a week, they might receive $8.50 a week until the loan is repaid. It’s an early lesson in the dangers of credit card abuse.
    Hunt’s oldest daughter, Alicia, uses Family Bank to manage her clothing budget. So she knows that spending $200 on a pair of Nikes will break the bank, whereas spending $30 on a pair of shoes gives her more options. It’s a great idea. When you give a child a set amount of money, or they earn a set amount of money, then you have the rewards and consequences that will help them become a better shopper.
    What doesn’t work, as I’ve learned with my thirteen-year-old daughter, Rebecca, is trying to get her to understand that something is too expensive. When I ask, “Do you really need to spend that much on a shirt?” she’ll just give me this puzzled look.
    At some point between ages eight and twelve, depending on the child, brand-name mania starts to take over the minds of young shoppers. This has been a terrible challenge for me and many other parents, because most children don’t understand the consequences of spending so much additional money to wear what the other kids think is “in.” It’s been a very hard thing for Rebecca. And this is a case when you’re going to be unhappy with what I have to say, because we have a “Don’t ask, don’t tell” rule in the family. I’m not allowed to go on the shopping trips for her clothes now, and I have no idea how much money is being wasted in the name of fashion.
    I don’t know yet whether Rebecca will become a frugal adult, or anything close.
    I do believe strongly that, by teaching a child about money, you can develop an adult who has good money values. When you give a child money again and again, the child never learns the logical consequences of unchecked spending. When they become a young adult, living independently, they pick up the same habits they had living under your roof. That’s why you do them an enormous favor teaching them the value of a dollar while they’re living with you.
    Some parents make the mistake of trying to give their children everything they didn’t have when they were children. I know a fellow whose parents were immigrants and had struggled to provide for him. Eventually he did very well financially, and he showered his three children with everything. Whatever they wanted, they got. No one ever said no. Now the three kids are adults, and there’s not a dollar they haven’t spent.
    I talked with a college student once who told me that the money his parents sent him never was enough. And he asked me how he could get his parents to send more. I told him that even if his parents could afford to give him more money to spend on pizza and beer, he couldn’t afford to take it. Because if he didn’t learn right away that money doesn’t come from an unlimited source, he was going to have a lot of trouble in his life.
    A lot of parents will buy a brand-new car for their child when he or she turns sixteen, and that’s an awful idea. Young drivers are going to get into fender benders, and it’s crazy to let them learn these lessons with an expensive new car. It’s fine to let the child use the family car, but even better is to provide a child with a recent used car. The child gets the responsibility for gas, maintenance (including oil changes), and insurance. That’s a fair amount of money for a teenager, but I think it builds responsibility. When they