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In his new book Piggybanking, personal finance writer Jeff Opdyke of The Wall Street Journal doles out sound advice to parents who want to raise money-savvy children.



From birth to graduation, he writes, children put pressure on the family finances. However, "not only are you now on the hook for tens of thousands of dollars in costs over the next two decades, you also have a new obligation to teach your children about money so that they grow into adults who are at home in the financial world and who have a healthy relationship with money."



To assist parents in this task, Opdyke has assembled a list of 15 money rules that every child should learn. The full list is available in an excerpt online, but here are some of my favourites:

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"When kids start asking parents to drive to the toy store to buy some plastic whatnot, it's time to consider an allowance." I have found that an allowance has been very effective in curbing my six-year-old's materialistic demands. Now when she asks for a new Littlest Pet Shop figurine I remind her that she can choose to buy it herself. She usually decides to keep saving her money.



"The size of an allowance shouldn't be so meagre that your child is a pauper among peers, nor so generous that your child can easily afford all wants without little financial planning." I give my six-year-old $5 a week, which I find is just the right amount. It is enough for her to save a portion, set some aside for charity and still have a reasonable amount to spend. I have friends who give their young children $1 per week, but this won't even buy a chocolate bar after tax these days. Give kids enough allowance to learn how to manage it.



"Good grades are expected and help around the house is simply the price of family life." I have friends who tie allowance to chores and dock money when their kids don't finish their work. While they swear this method guarantees their children help out, I agree with Opdyke that chores like making beds or putting clothes in hampers are just the house rules.



"Parents don't need to save every last dime a child will need for college expenses. You only have to save up to your ability or desire to pay." Starting an RESP early on in your child's life and benefiting from the government match program is just a smart thing to do. Still, a fully paid higher education is a luxury that many parents cannot afford for their children, especially as the cost of that education rises. There is nothing wrong with your young adult helping to earn their way through part-time or summer work.



"One of the greatest gifts you can give your child is your own financial self-sufficiency when you're old." This is one of the gifts my parents have given me, the result of their saving and financial planning and simple lifestyle. Thinking about my children's future inspires me to put away money in my RRSPs each year.

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