They already know money doesn’t grow on trees

MIAMI — You found the backpack. You bought the pens. You’ve got plenty of paper.

But you may not really be ready to send the kids back to school until you’ve worked out a spending plan.

How much money should the kids have each week? Who’s going to decide what’s a necessity? A yearbook? A new outfit for the dance? Should parents hand over more money when the kids run out?

This is going to be a learning experience for both adults and students, the experts say.

“Now that my son is going into high school, I want to make sure he has some money with him, because there are more opportunities,” said Debbie Cole of Davie, Fla., mother of Jeremy, soon to be a student at Nova High School, and Julie, who is going into fourth grade. “But I don’t like sending in large amounts of money.” Jeremy, she said, will probably get between $5 and $10 a day if he needs it, while Julie will get $1 or $2 occasionally.

There’s no right or wrong way to teach kids about spending.

“If a family can afford to give students a little bit of exposure to having money, they can make simple spending decisions and begin learning to pace themselves,” said Nan Mead of the National Endowment for Financial Education, which is headquartered in Denver.

“The benefit is kids learn how to be responsible with whatever amount of money they have.”

Chances are the kids won’t have a clue at the start. A survey released last month by Visa USA and the Girl Scouts found that only 13 percent of teenage girls had ever tried to write a budget. And most had never talked with their parents about how the family manages its money.

So here are a few suggestions:

• “Allowances can begin when school starts,” suggested Paul Richard, executive director of the Institute of Consumer Financial Education headquartered in San Diego.

For the youngest kids starting in kindergarten, he says it can be as little as 25 or 30 cents a day. For children from third grade through middle school, some parents give a weekly amount equal to or slightly less than the child’s age.

• As the amount grows, so should the responsibilities. “Maybe they can buy their own candy for the week,” Richard said in a telephone interview.

“By the time you reach the teenage years, it could be time for them to start buying some of their own clothes.”

• Try giving a middle school student the entire month’s allowance at one time. Probably, the first month, the youngster will run through it quickly. If the parent doesn’t give out more until the following month, that’s a lesson in itself. Mead suggests that after a few months, the student should get the hang of it.

• In high school, the need for cash will increase significantly. Parents might want to look for a savings account that comes with a debit or ATM card, so that the student doesn’t have to carry too much cash.

• Along with the money that you give your children, should come some conversations. Parents and students should together brainstorm about how much the student will spend. Then divide that into such needs as transportation and school costs, and what’s merely wanted.

“Once the list is written down, they should try to prioritize on the `want side.’ The parents can explain what they can afford,” Mead said.

If your child is the kind who thinks the family can afford everything, one good idea is to sit down with him or her to pay the bills. Show the student how you make money decisions.

“That’s a terrific message to give to kids,” Mead said.

“That we, as a family, have our limits.”