Kids and Money

Our elder daughter turned seven in the month of Feb 09. Both of us were very exited about this chronological milestone in her life. She was exited because she is only 3 years away from getting a puppy ( we have promised her she can get a puppy once she turns 10).

One of the traits that I have been observing in her for last few years was her tendency to go to a junk food stall the moment we reached a mall. Actually from home itself she will inform us that she wants to have a burger at McDonald's or a Pizza and Garlic bread at Pizza hut. She will not accept a any other food brand. Now all these stuff besides not being very healthy is also expensive to buy.

Now as she has learned additions and subtraction at school I decided to give her pocket money -a princely sum of Rs 500 every month. She gets this money on the first Saturday of every month ( This is the fist time in a month we would be going out shopping for that month)
Now given below are the rules for the same:

1. She gets 5 one hundred rupee notes.
2. She can spend money only on weekends for buying stuff like junk food ( I know it is not healthy but she is only 7, how can i stop her if I myself enjoy it?). She can use the money to buy stuff from the store in the compound.
3. Her mother is the custodian of the money.
4. She is not allowed to take any money to the school ( she is in class 2 in DPS )
5. She needs to maintain a small diary in which her mom keeps a record for all the money she has spent.
6. She has to save Rs 50 minimum every month of this 500/- if she is able to save Rs 50 every month then I add another 50 to the same and Rs 100 is deposited in her savings bank account with the bank. ( she is familiar with the concept of bank, although she feels I am pretty close to one :) )
7. Overdrafts are not allowed.

I understand that these are very stringent conditions and 500/ Rs per month is not a big amount for a 7 year old in todays world when a pizza cost upward of 250. But the idea is that she understands the concept of money, budget and responsibility. My wife thinks that I am going too far but it has become a game between papa and The Princess.

She also has some money that our relatives have given to her so she is very exited about all this and counts her money every once a while in the week just to be sure the money is there.

I really like it when she now checks the price of a item before she demands it. Will keep you posted on the developments.