Bank on It

"Can I please, please, please just get one CD?" my daughter Brittany pleaded as we walked through Target.

"If she gets one, I can get one, right?" asked my other daughter, Ally.

Already loaded with necessary toiletries and cleaning supplies, there wasn't much room left for anything else in our cart, let alone our budget.

My habit of letting the girls each get a small item at the store to keep them busy had grown into something more frequent — and more expensive. Their days of being satisfied with $1 plastic toys were over, and I had unwittingly created a bad habit — one that needed to be broken before it broke us.

"Not today, girls. We don't have extra money this week for things we don't need. Instead of CDs, let's go look at the banks," I told my daughters, who exchanged puzzled glances. I had the girls each choose three different colored plastic banks and we headed for the checkout line.

When we got home, I lined the set of banks up on the girls' dresser and labelled them. One would strictly be for savings, one for spending and the other for giving to charity or buying birthday gifts for their school friends.

From then on, every time the girls received any money — like from birthday gifts or doing extra chores — it would be equally divided among the three banks.

"You're going to start buying the things you want with your own money," I explained. "I'll teach you how to save it, but you will decide on what — and when — you want to spend it."

The girls were excited. They'd never before made decisions about how and when money was spent.

They couldn't wait to start and quickly earned $5 each cleaning the garage. And after Brittany's birthday the following week, they ran upstairs to divide the money into the banks.

When we realized Brittany already had enough in her spending bank to buy the CD she wanted, I offered to take her to Target.

"No, thanks," she said. "I don't think it's in my budget right now. I'm going to save for something I really want — like an iPod."