Mom makes 5 year old pay "rent"

[Rob Base 2.0]

Here's the story

www.ibtimes.com/georgia-mom-makes-5-year-old-daughter-pay-rent-utilities-surprising-reason-2643423

Basically- mom gives the kid $7 a week, but makes the kid pay the mom $5 for rent, food, etc.  Idea is to teach the kid a money lesson (also mom is supposedly saving the $5 for the kid for the future)

I seen some comments saying it's a good idea, and others saying the kid is too young-let the kid be a kid for a while, etc.

What say you, YM&M?  Good idea?  Bad Idea?  To each their own? 

[Shooby]

I probably would not even be giving a 5 yr old an allowance as i really dont think they have any concept of money, but at least she is trying.

[Cookies Galore]

Slacker. You should be paying once you vacate the womb!

[cktc]

I think parents being financially aware and attempting to teach their children how to be responsible with money is the most important thing. I'm not sure how much the method matters. I certainly don't see any harm with this though. 

[Lizard Queen]

Like I commented on the article when I saw it the other day, I think it could work well for an older kid, but 5 is too young.

[giramomma]

Jan 21, 2018 11:52:01 GMT -5 Shooby said:

I probably would not even be giving a 5 yr old an allowance as i really dont think they have any concept of money, but at least she is trying.

I think it depends on the kid.

My oldest is interesting with money. At 5, he could go through his piggie bank, get enough money (with a bit of help) to buy a pack of pokemon cards, and remember that he needed to add in money for sales tax. At 6, he was going through his piggy bank and donating money to church, and then telling us later about it.

He also is a spender..money completely burns a hole in his pocket. But, he likes going all cash, rather than using his debit card.

DD1 did not have any interest in money until she was 8ish. She's also is going to be a saver.

DD2 is a blend. She doesn't care about money right now, but it absolutely burns a hole in her pocket.

Jury will be out on DD3 for a while.

We also try to introduce money concepts by 5. We will make statements like: "It takes me teaching x number of lessons to pay for abc." When my older two were 8 and 5, they complained about taking the bus to work with me to do a kid exchange with DH (I work opposite his hours in summer.)  I explained that paying for parking would run $200/month. And we could make a choice...do we pay for parking or do we go on vacation? My kids decided they'd get more enjoyment out of a vacation than watching me park my car...and that was the last time I heard complaining about that.

[Bonny]

Jan 21, 2018 12:23:56 GMT -5 Lizard Queen said:

Like I commented on the article when I saw it the other day, I think it could work well for an older kid, but 5 is too young.

And I'd take your comment further by saying at that age giving the kid(s) some chores to make a contribution to the household is more important.

Since parents are legally responsible for basic support for their kids e.g. shelter, food, clothing I think forcing a kid to turn over his/her earnings is a little cruel. That's an issue that could be revisited at 16 (legal age for minors to work), 18, and if/when a kid graduates from college.

And the YMer in me is horrified that the child is being asked to spend over 71% of her income on housing. How the h*ll is she going to save for retirement?

[midjd]

Jan 21, 2018 12:46:34 GMT -5 Bonny said:

Jan 21, 2018 12:23:56 GMT -5 Lizard Queen said:

Like I commented on the article when I saw it the other day, I think it could work well for an older kid, but 5 is too young.

And I'd take your comment further by saying at that age giving the kid(s) some chores to make a contribution to the household is more important.

Since parents are legally responsible for basic support for their kids e.g. shelter, food, clothing I think forcing a kid to turn over his/her earnings is a little cruel. That's an issue that could be revisited at 16 (legal age for minors to work), 18, and if/when a kid graduates from college.

And the YMer in me is horrified that the child is being asked to spend over 71% of her income on housing. How the h*ll is she going to save for retirement?

I was going to say the same thing. I have zero problem with giving an allowance, or designating portions of it for savings/charity, but I don’t think parents should be “charging” their kids for anything they’re legally required to provide them.

[The Walk of the Penguin Mich]

Jan 21, 2018 12:46:34 GMT -5 Bonny said:

Jan 21, 2018 12:23:56 GMT -5 Lizard Queen said:

Like I commented on the article when I saw it the other day, I think it could work well for an older kid, but 5 is too young.

And I'd take your comment further by saying at that age giving the kid(s) some chores to make a contribution to the household is more important.

Since parents are legally responsible for basic support for their kids e.g. shelter, food, clothing I think forcing a kid to turn over his/her earnings is a little cruel. That's an issue that could be revisited at 16 (legal age for minors to work), 18, and if/when a kid graduates from college.

And the YMer in me is horrified that the child is being asked to spend over 71% of her income on housing. How the h*ll is she going to save for retirement?

But that's about right.  After saving for retirement, short term savings and paying bills, I generally had less than 30% of my income left.  I had to buy groceries, entertainment and gas on that too.

BTW....the money is going into a savings account for the child.

[The Walk of the Penguin Mich]

Jan 21, 2018 13:03:17 GMT -5 midjd said:

Jan 21, 2018 12:46:34 GMT -5 Bonny said:

And I'd take your comment further by saying at that age giving the kid(s) some chores to make a contribution to the household is more important.

Since parents are legally responsible for basic support for their kids e.g. shelter, food, clothing I think forcing a kid to turn over his/her earnings is a little cruel. That's an issue that could be revisited at 16 (legal age for minors to work), 18, and if/when a kid graduates from college.

And the YMer in me is horrified that the child is being asked to spend over 71% of her income on housing. How the h*ll is she going to save for retirement?

I was going to say the same thing. I have zero problem with giving an allowance, or designating portions of it for savings/charity, but I don’t think parents should be “charging” their kids for anything they’re legally required to provide them.

I think it drives home the message that nothing in life is free.  You want hot water to shower?  Wifi?  Electricity?  It is going to cost someone.  My sister is trying to drive this home with her 16 year old, and she is not learning the lesson.  So when do you start?

[tallguy]

Jan 21, 2018 13:16:23 GMT -5 The Walk of the Penguin Mich said:

Jan 21, 2018 12:46:34 GMT -5 Bonny said:

And I'd take your comment further by saying at that age giving the kid(s) some chores to make a contribution to the household is more important.

Since parents are legally responsible for basic support for their kids e.g. shelter, food, clothing I think forcing a kid to turn over his/her earnings is a little cruel. That's an issue that could be revisited at 16 (legal age for minors to work), 18, and if/when a kid graduates from college.

And the YMer in me is horrified that the child is being asked to spend over 71% of her income on housing. How the h*ll is she going to save for retirement?

But that's about right.  After saving for retirement, short term savings and paying bills, I generally had less than 30% of my income left.  I had to buy groceries, entertainment and gas on that too.

BTW....the money is going into a savings account for the child.

I think it's a helluva deal.  Save one dollar from the two left over.  That is 14.3%, right around the 15% that is usually advised for even older workers.  And they get a 500% employer match, though the vesting schedule is a bit longer than usual.  

[cktc]

I don't really think it's cruel since money is coming from bank of mom in the first place. Technically she is still providing everything. If she starts confiscating money from odd jobs or gifts from others that's another story.

My sister's both worked in high school and most of their pay went to grandma's inability to manage money. I opted not to work because I didn't see the point. That was a mistake in hindsight since I missed out on years of work experience. Although my sisters both struggle to save, possibly because they learned to spend it before someone takes it.

[Lizard Queen]

Jan 21, 2018 13:22:37 GMT -5 The Walk of the Penguin Mich said:

Jan 21, 2018 13:03:17 GMT -5 midjd said:

I was going to say the same thing. I have zero problem with giving an allowance, or designating portions of it for savings/charity, but I don’t think parents should be “charging” their kids for anything they’re legally required to provide them.

I think it drives home the message that nothing in life is free.  You want hot water to shower?  Wifi?  Electricity?  It is going to cost someone.  My sister is trying to drive this home with her 16 year old, and she is not learning the lesson.  So when do you start?

There is a big span of time and development between 5 and 16. I could see 10, or maybe even 8. I have a 5 year old, and he would not understand the lesson here, with the money being taken away for "rent". Granted, all kids are different, but I think a focus on delaying gratification is more appropriate for this age.

[Tennesseer]

Instead of charging for food and rent, how about teaching them how to save money.

Start out with the seven dollars a week.  For example, tell your children every time they leave a room (for good) and fail to turn off the lights, that will cost them $.25, $.50, or a $1.00.  Same thing with turning off the television.  Electricity costs money.

Clothes on the floor?  $1.00  Clothes cost money.  Take care of them.

Brushing your teeth, bathing, and other hygiene?  Bad hygiene costs money.

Be creative.  Doing all the above is more money in their pocket at the end of the month.

Charging for rent and food can begin once they have employment outside of the home.

[chapeau]

When we were kids, my mom would periodically decide we were watching too much tv. So she would give us each 10 pennies per week. Each 30 minutes of tv cost 1 penny. There were certain free things, like the whole family watching the super bowl, or The Sound of Music, or something similar. Homework assignments also didn’t count, nor important things (Reagan or the Pope getting shot, Challenger disaster), if age appropriate.
We learned to budget, sitting down with the TV guide from the Sunday paper and seeing what we wanted to watch that week, deciding if the facts of life was more important than the dukes of hazzard, etc. We learned to negotiate like crazy. And, of course, hang out in the family room “not” watching tv.
Mom is completely convinced that all of her kids can pinch a penny til it screams because of that.

[muttleynfelix]

My daughter just turned 5 and I can't imagine the concept making sense to her. My son turned 8 today. We started an allowance with him last week. He gets $2. One of those dollars he gets as 4 quarters. He had to save 50 cents and to be 50 cents to charity.

I could see bumping up the rent concept in high school. It depends on the kid. I didn't need to be charged rent to understand what it cost. But I could see that being an issue with my son.

[whoisjohngalt]

We have no allowances in our house and never will (as long as I have a say) and they know it.

But I pay them for all kinds of silly crap, so if they want to, they can get cash out of me. I don't tell them what to do with their money but I do tell them what we do with ours. Not specific numbers, but general ideas.

I can see what this mom is trying to do, so I won't judge her methods.

[whoisjohngalt]

Jan 21, 2018 21:10:40 GMT -5 chapeau said:

When we were kids, my mom would periodically decide we were watching too much tv. So she would give us each 10 pennies per week. Each 30 minutes of tv cost 1 penny. There were certain free things, like the whole family watching the super bowl, or The Sound of Music, or something similar. Homework assignments also didn’t count, nor important things (Reagan or the Pope getting shot, Challenger disaster), if age appropriate.
We learned to budget, sitting down with the TV guide from the Sunday paper and seeing what we wanted to watch that week, deciding if the facts of life was more important than the dukes of hazzard, etc. We learned to negotiate like crazy. And, of course, hang out in the family room “not” watching tv.
Mom is completely convinced that all of her kids can pinch a penny til it screams because of that.

O  M  G  I looooove this!!!!!!!!!

[toomuchreality]

Jan 21, 2018 21:10:40 GMT -5 chapeau said:

When we were kids, my mom would periodically decide we were watching too much tv. So she would give us each 10 pennies per week. Each 30 minutes of tv cost 1 penny. There were certain free things, like the whole family watching the super bowl, or The Sound of Music, or something similar. Homework assignments also didn’t count, nor important things (Reagan or the Pope getting shot, Challenger disaster), if age appropriate.
We learned to budget, sitting down with the TV guide from the Sunday paper and seeing what we wanted to watch that week, deciding if the facts of life was more important than the dukes of hazzard, etc. We learned to negotiate like crazy. And, of course, hang out in the family room “not” watching tv.
Mom is completely convinced that all of her kids can pinch a penny til it screams because of that.

There were 7 kids in my family. If my mom would have done this, I think we could have still watched everything. Plus, we would have had an excuse for watching tv... I paid for it! -I can also see a lot of arguments stemming from it. "You didn't pay! This is MY tv show." Followed by "M o m m m m!" etc. (We only had 1 tv and it didn't always work, or work well.)

In my house, it would have been a disaster.



On the other hand, around age 10-11, each of us took our turn going to my grandma's every Saturday, for a few years. We did her laundry (washed, dried, folded and put away), and any other chore she could think of (washed all her windows inside and out, as well as removed all her window screens and scrubbed them with a bucket of soapy water, a brush and the hose, pulled weeds, etc). For doing this, we were paid a flat $5 per week and she bought us lunch from the Hires down the street. My parents dropped us off and we spent the day helping grandma. Then they picked us back up about 4-5 hours later. -And there was no slacking between chores!



As soon as we were old enough to earn our own money by going to grandma's we had to buy all our own stuff. But we never had to pay rent or anything. We all got a 'real' job as soon as we were old enough and the person younger than you was old enough to go to grandma's, cuz the pay was so much better. LOL



We weren't allowed to have our own car until we graduated from high school, even if we bought it ourselves. We either walked or took the bus to school.



Things are SO different these days! -I wouldn't want to go through the current challenges. But I also don't long to relive my childhood.

[zibazinski]

Jan 21, 2018 22:38:32 GMT -5 toomuchreality said:

Jan 21, 2018 21:10:40 GMT -5 chapeau said:

When we were kids, my mom would periodically decide we were watching too much tv. So she would give us each 10 pennies per week. Each 30 minutes of tv cost 1 penny. There were certain free things, like the whole family watching the super bowl, or The Sound of Music, or something similar. Homework assignments also didn’t count, nor important things (Reagan or the Pope getting shot, Challenger disaster), if age appropriate.
We learned to budget, sitting down with the TV guide from the Sunday paper and seeing what we wanted to watch that week, deciding if the facts of life was more important than the dukes of hazzard, etc. We learned to negotiate like crazy. And, of course, hang out in the family room “not” watching tv.
Mom is completely convinced that all of her kids can pinch a penny til it screams because of that.

There were 7 kids in my family. If my mom would have done this, I think we could have still watched everything. Plus, we would have had an excuse for watching tv... I paid for it! -I can also see a lot of arguments stemming from it. "You didn't pay! This is MY tv show." Followed by "M o m m m m!" etc. (We only had 1 tv and it didn't always work, or work well.)

In my house, it would have been a disaster.



On the other hand, around age 10-11, each of us took our turn going to my grandma's every Saturday, for a few years. We did her laundry (washed, dried, folded and put away), and any other chore she could think of (washed all her windows inside and out, as well as removed all her window screens and scrubbed them with a bucket of soapy water, a brush and the hose, pulled weeds, etc). For doing this, we were paid a flat $5 per week and she bought us lunch from the Hires down the street. My parents dropped us off and we spent the day helping grandma. Then they picked us back up about 4-5 hours later. -And there was no slacking between chores!



As soon as we were old enough to earn our own money by going to grandma's we had to buy all our own stuff. But we never had to pay rent or anything. We all got a 'real' job as soon as we were old enough and the person younger than you was old enough to go to grandma's, cuz the pay was so much better. LOL



We weren't allowed to have our own car until we graduated from high school, even if we bought it ourselves. We either walked or took the bus to school.



Things are SO different these days! -I wouldn't want to go through the current challenges. But I also don't long to relive my childhood.

I like this idea. What a way to help and bond with your grandmother at the same time.

[NoNamePerson]

Jan 21, 2018 11:58:07 GMT -5 Cookies Galore said:

Slacker. You should be paying once you vacate the womb!

NO you should be paying rent before you vacate the womb - I mean you are being housed and fed then also.

[jd2005]

My kids (6 & 3) have a commissions chart.  If they want $ to buy something (toy/candy/etc.), then they have to work.  

[Tiny]

I think the kid is getting a great deal on that "rent" - a lot of bang for their buck.   

Seriously, I think it depends on the kid.   I suspect the kid has voiced some interest in something that costs a bit of money (like some technology or maybe pet or maybe some over the top equipment for a hobby) AND has exhibited some sort of cognizance of "money" and that things are not "free for the taking".   I don't think the parents are hurting the kid doing what they are doing.  
If the parents did nothing -- I'm pretty sure in the next year or two the 5 year old (now 6 or 7)  would have become aware that there are "bills" to pay (and that adults pay them)  for things like cable and phones and maybe even something like "rent" or a "mortgage"  and groceries and the electric bill and the credit card bill... unless they are very very sheltered.   

FWIW:  at 5 I had a very fuzzy concept of money - I remember knowing the denominations of coins and bills and that you needed them at the store to buy things - but I wasn't very clear on the idea of "value" and how a piece of paper could have "value" of say a coloring book or crayons.  (I had a deprived childhood back when kids had to walk to and from school uphill in the snow - both ways).    I think I was well into kindergarten maybe the beginning of first grade that I "got" the value aspect of it.      That's not to say that if you told me something was .50 I couldn't count out the right coins or know that paper money was too much.  I could parrot back the right answers - I just didn't "get it". 

[Tiny]

What kinds of things do 5 year old's buy these days?  

When I was a kid - I think I walked into a store with my mom maybe once a week (groceries) if that... and I wasn't really allowed a say in what got purchased.   At 5, even if I had a million dollars there wasn't anywhere I could go to spend it.    I didn't need "lunch money" for school and I think maybe there was a "book" sale once a school year where you could take home a 'catalog' and order books.  I didn't get to order books - so I didn't have to take money to school to pay for them.   I wore a uniform to school - so I didn't go clothes shopping - new clothes (or hand me downs) appeared at home.    There weren't  fast food places or convenience stores or anything like that  on my walk to school (or when I was older and would go alone on my bike to the library or the rec center (there were vending machines there).  I wasn't in any sports or after school activities.)     I knew where the "corner store" was to get milk, bread, and cigarettes for my dad  and I knew where all the corner bars were... but other than that.  I wasn't going to the department stores (or mall) as a kid. 

It wasn't until Freshman year in HS that I had "pocket money" - because I had to buy a bus pass and then if I wanted to buy something in the cafeteria I needed 'lunch money' - I always brought a sandwich and some fruit and something to drink so I didn't really need to buy food.   - I lead a deprived childhood.   

I guess kids have a lot more access to places to buy stuff?   

[lynnerself]

I think 5 is too young also. This technique is too severe for my personal taste.
I think you teach best by modeling the behavior you want to instill in them. And being open not secretive about finances.
Also, what about teaching the lesson that if you choose to have children, you better be able and willing to provide a loving home that includes food and shelter.

[Bonny]

Jan 22, 2018 11:05:12 GMT -5 lynnerself said:

I think 5 is too young also. This technique is too severe for my personal taste.
I think you teach best by modeling the behavior you want to instill in them. And being open not secretive about finances.
Also, what about teaching the lesson that if you choose to have children, you better be able and willing to provide a loving home that includes food and shelter.

!

ETA: I find no small irony in the fact that my parents who were obsessed with money; e.g. "we don't "give" our kids anything". No allowances, you must "pay" for everything or you won't appreciate it, yada, yada were/are in financial straits. Mom died in $400k of debt, Dad at age 83 has $1,500 to his name and is a Medicaid and food stamp recipient. There's a good probability that DH and I will have to foot the bill if he goes into assisted living.

I know I'm projecting here but I'm concerned about a parent that is that focused on making a kid pay her own way that early. Money IS important but it's not everything. Trite but true.

[giramomma]

Jan 22, 2018 11:05:12 GMT -5 lynnerself said:

I think 5 is too young also. This technique is too severe for my personal taste.
I think you teach best by modeling the behavior you want to instill in them. And being open not secretive about finances.
Also, what about teaching the lesson that if you choose to have children, you better be able and willing to provide a loving home that includes food and shelter.

Last year, along with more of the sex talk, DS at 12 got the "how much daycare costs" talk.

With #4, at 13, he got the "um, you'd better not continue to plan to have us take care of your kids when you work. We want a break with kids."

I also, think, though, in this day and age, a non-ym approved pregnancy isn't the worst dumb thing a person can do. The fall out from driving drunk (like killing someone), drug addiction, or having sex with someone who isn't age of consent in a state with no romeo and juliet laws (like mine-hello sex offender label and ruined life), imvho, is far worse than pregnancy.

[HoneyBBQ]

Jan 21, 2018 11:52:01 GMT -5 Shooby said:

I probably would not even be giving a 5 yr old an allowance as i really dont think they have any concept of money, but at least she is trying.

My 6 year old definitely understood the concept of money at 5.

We give her $1 a week. She's saving it for HER daughter's college. (If I ever needed proof kids remember what you say, this was it!)

I would say the rent scheme is way too young to get at 5. But the idea of saving to buy something and the fact that things cost money - they can definitely grasp that concept. 

My daughter had a pretend garage sale last year (in the play room) and she marked all her toys for sale. The things that she loved were obviously over priced (used dirty baby doll, $20) and the things she didn't like so much was $1. She was going to go around door to door "selling" paper bracelets for $5 to 'make money'. It was hard to convince her the average person would not give her 5 bucks for a piece of paper. So there are some subtle things she isn't understanding but the basics are there.

[whoisjohngalt]

I know everyone says "model the behaviour", but it only works when it works. And when it doesn't - there has to be some major brainwashing teaching going on. And that only works when it works. And then you just have to pray a lot and save for therapy (whether your own or your child's).

[Apple]

A few things...

I don't think 5 is too young to learn about money and wants vs needs, or "if I get this, I have to not get that, or have to wait to get that".

My first thought was that the amount toward "bills" was way too high for the savings rate, and if you really want to prioritize savings, make the savings percentage much higher (50% is good).  I'd rather have the "normal" to strive for be that living expenses should only be 50% of your financial structure, not 71%.  Sure, it's tough when you first start out, but if "saving 50%" is normal to you, you'll want to find more ways to spend less or earn more.  IMO, if this is meant to encourage saving skills.

There are many flaws...  The child has no control over their housing, so they can't choose to stay in a smaller place to save some money.  If they decide they want pasta for dinner instead of steak, are they going to get some of the food money back?

My son got to earn money doing different jobs.  If he wanted to earn some money, I might have paid him $5 to organize my pantry (something I wanted done, but didn't want to do myself).  Or he might go pull weeds and pick rocks out of my parent's garden.  He even made and sold soap and picture frames for a while.  He was expected to participate in basic chores and housework without getting extra money though.

The dollar division I encouraged:  Save 50% for "long term" wants/needs (large expensive stuff in the future-- a bike, a car, college, whatever).  Save 25% for "short term" wants (a video game, spending money for a later vacation, something he'd have to save for for at least a few weeks), and 25% could be spent right now (or saved up to help buy that video game).  

I covered all his needs, and most all of his wants.  When we went to a movie, I always covered the ticket, but if he wanted something to eat/drink, he had to buy it himself.  I can't think of a single time he thought the popcorn or pop was worth the money.  When he was little, I would occasionally get him the "kid pack" (lots of popcorn, a small pop, and a big bag of fruit snacks that he saved for later), but it was not every time, so it was a "treat".

When we would go on vacation, he would have his own spending money (some of his own, some I gave him).  He would know exactly what he had at the very beginning of the trip, and would figure out how to budget it and not blow it all at once.  If we saw something he liked early in the trip, and we might not see it again, he'd debate if it was really worth using that money now, or keeping it, and hoping he'd find something even better later.  The first time I did this with him (a trip to Disneyland, Knott's Berry Farm, etc) I noticed immediately that there was no more "Mom, I want..." in the souvenir stores!  It was so peaceful.  Just took a little more time because he wanted to look at things, find the price, and see how much money he had.

He's 20, and still more of a saver than a spender.  I don't know how much of that is just his nature, and how much of that was instilled, but it gives me hope for his financial future (even if he still has no clue what he wants to do for a career).

I like that this method encouraged savings and forced him to make decisions on prioritizing his spending.  He knew that when he graduated he would have to get a job and help cover bills (car insurance, gas, cell phone, etc. I encouraged theater over a job during high school though, because it was so good for him.)  He was still a little shocked with how much was taken out of his check for taxes though.  I'm not sure you can ever truly prepare someone for that

ETA:  I'm also "the type" who got a savings account in his name before he was a year old (I put all my change toward this account), and had him open a Roth when he got his first job.  I had him put in 2/3 of max, and I put in the last 1/3.