Author Topic: Reloadable debit card for tween allowances?  (Read 1514 times)

moonpalace

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Reloadable debit card for tween allowances?
« on: March 27, 2017, 07:22:08 AM »
I've been looking for a way to get out of the current way we deal with our kids' allowances, which is crazy-making. The basic problem is that they sometimes want to spend online, and sometimes in stores (and then, sometimes in tiny amounts that stores don't want to take a debit card for anyway). So we're left tracking every little transaction they have, and I'd really like to find a simpler system where they do the tracking/budgeting themselves, which would be good for everyone concerned! Kids are 8 and 12. I think this would be easiest if at the beginning of each month I could just put each kid's allowance on their debit card.

Wondering if anyone else has used reloadable debit cards for this, and if so which ones are best? Or is there a better way?

In googling it I came across something called Greenlight, which looks nice but is $5/family/month. Many other reloadable debit cards have worse fees than that (some have a per-transaction fee of up to $2!!! YIKES!).

InnTee

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Re: Reloadable debit card for tween allowances?
« Reply #1 on: March 27, 2017, 08:08:54 AM »
We just give a cash allowance. When they want to make online purchases, we do it for them and they reimburse us. It's a bit cumbersome, so if there's a cheap/free reloadable card option I'd be interested as well.

Laura33

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Re: Reloadable debit card for tween allowances?
« Reply #2 on: March 27, 2017, 08:45:29 AM »
FWIW, I think tween might be a little too young for this, but it depends on your kids.  The way it worked out for us was:

Bank account (savings) when she had sufficient $ to merit it.  For us, this was 13 (bat mitzvah $).  Allowance = cash.  $ goes into savings but doesn't come out.

At 15, she got a checking account and associated debit card.  I was worried, but she had a summer trip without us where she needed to be able to cover lunches, and I didn't want her to carry all the cash.  So we transferred enough from savings to checking to cover the expected total + $100, and then we kept an eye on it.

Turns out, she was sort of ridiculously mature and responsible about handling the debit card.  So last fall, I set up an automatic transfer for her allowance every month (I think it's 2/3 into savings, 1/3 into checking; she has the ability to transfer over some into checking if she needs it, but the minimum is 1/3 to savings).  She then has a part-time job that she can deposit herself into either account.  We do all of this via online banking.

She also still periodically works for us to earn more $ (e.g., babysitting).  We keep a running tab on a note on the fridge.  When she wants $ for something that requires cash or a CC, we subtract it against what we currently owe her on the note, and I give her cash or pay directly with my CC.

My DS (11) just has a savings account.  He does much of his purchasing through prepaid gift cards (e.g., PS4 stuff thanks to his birthday stash).  If he does want something from somewhere else, I just transfer from his savings account to mine.  But he is also not the problem child in this regard (I used to give him $5/wk cash and $5 in his savings account, and he asked me to put it all in savings, because he had all these $5 bills scattered in his room!).

moonpalace

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Re: Reloadable debit card for tween allowances?
« Reply #3 on: March 27, 2017, 09:22:20 AM »
FWIW, I think tween might be a little too young for this, but it depends on your kids.

This had me laughing out loud: I definitely worry that my 12-year-old is "too young" but I'm convinced I could turn our entire household budget over to the 8-year-old and she'd handle it better than I do!

Thanks for the detail about you handle things! It makes me wonder if I'm looking to make this simpler than it naturally should be.

begood

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Re: Reloadable debit card for tween allowances?
« Reply #4 on: March 27, 2017, 09:27:34 AM »
We too got our 15-year-old a debit card associated with a checking account.

So far she has not shown interest or willingness to do the tracking component. She asks me to tell her how much she has, and then asks me to transfer money from savings to checking when she wants to buy something.

She is good about saving, though. When she gets paid, she puts at least half (sometimes more) into savings. I figure if even that message gets through at this age, she's ahead of the game.

We also put a "floor" on her checking account. If it drops below $300, she gets a text and knows to ask me to replenish it.

caracarn

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Re: Reloadable debit card for tween allowances?
« Reply #5 on: March 27, 2017, 09:44:49 AM »
I have used CaptialOne 360 MONEY accounts.  They are designed basically for this purpose.  I'm not sure if their in an age limit (I'm not sure about your 8 year old) they allow it with, partially because stores may questions an elementary school child whipping out a debit card.  We do exactly what you are talking about moving their allowance to it regularly and they go from there.  The small transactions are still a problem, though they can hit the ATM to get cash, and you can teach them about free ATMs.  Since you are taking them where they need to go (since last I checked the 8 or 12 year old can not have a driver's license) you can direct them to proper ATMs.

moonpalace

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Re: Reloadable debit card for tween allowances?
« Reply #6 on: March 27, 2017, 11:54:02 AM »
Thanks, everyone! Very helpful. The Capital One 360 MONEY accounts look especially good (and fee-free).

One thing to note, responding to Caracarn's comment: we live right in the middle of a small town (1/4 mile from downtown) so even our eight-year-old can walk with a friend to small shops. And the people in the toy store and book store and bakery know her, so she could actually go there and use a debit card. And the twelve-year-old can walk/bike easily to basically everything in town (pool, minor-league baseball, stores, restaurants, etc.) either on his own or with friends.

The Greenlight and MONEY cards don't seem to allow overspending, so I don't see any real downside to trying one of them.

caracarn

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Re: Reloadable debit card for tween allowances?
« Reply #7 on: March 27, 2017, 12:34:15 PM »
The nice thing with the MONEY accounts is that they let you have as many as you need (up to 25 I think), and they literally open immediately online.  You need to wait for the debit card to arrive, but is very simple (and free as you mentioned).

natb2347

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Re: Reloadable debit card for tween allowances?
« Reply #8 on: March 30, 2017, 07:00:20 PM »
I wish my parents gave more thought to this.  I did chores and got cash and then spent it all since all my needs were already met as a dependent.  Not bad as they at least required me to earn the money somehow which I appreciate and it did help.  Any birthday money was just handed over to my recollection which I also squandered.  Yeah, they always raised me on "save your money" but I had NO idea what that meant or how it could benefit me if I held onto it.  I even had a gas card for while that my dad paid for for a while after I started driving!  I was the designated driver for all my friends since I didn't have to pay for gas to go anywhere!!  But somehow, once I started working and the gas card got cut off and I was expected to buy myself anything that wasn't a "necessity", I slowly but surely started learning that value of a dollar. 

IMO a card vs cash is a bad idea unless they are much older - and even then they should do something to earn what goes in there (good grades, helping others, helping around the house, biking places ala MMM, etc.  I also think showing in simple terms how saving money/ compounding works to kids/teens can be very compelling.  I WISH I learned this at that age!!!  I like the spreadsheet bank of dad idea of MMM is very clever especially because it includes interest earned.  Seeing this in black and white is so valuable for a young mind. 

Lessons to teach:

-getting money takes work/effort
-saving it earns more money that you don't need to give work/effort to get.  Over time it compounds!
-it is much easier to track and digest spending with physical dollars than on a card
-spreadhseets and expense/spending/saving tracking are best done on a spreadsheet or app (mint.com!).  early habits are key.  It helps keep focused and excited about money as a TOOL and what it can do if you are smart about it.