Spend, Save, Give, Grow: Let Children Choose Each Dollar's Job

Short answer

Jars won't teach much if a parent decides the split. The learning comes from your child choosing, living with the result and choosing again next week.

Each jar has a recommended job. Your child decides how much goes in each one; the job tells them what that money is for.

1. A
   Spend: money for nowSmall things they want this week or soon, such as a treat, a small toy or a game. It's fine for Spend to run out; that's what it's for.
2. B
   Save: short-term goalsSomething they want in the next few weeks or months, such as a LEGO set or a scooter. Save works best with one goal they can picture.
3. C
   Give: money for othersA cause, a charity, a friend or a family member. It can wait until your child finds something that matters to them.
4. D
   Grow: long-term savingMoney for something a year or more away, or for a goal they haven't chosen yet. It's money they plan to leave alone for a long time.

The difference between Save and Grow is time. If your child can picture getting it soon, it's Save. If it's a year or more away, or they don't know yet, it's Grow. A dollar a week in Grow is $52 after a year.

Grow is saving, not investing. The money doesn't earn anything; it simply waits and adds up as your child puts more in.

Save and Grow are two kinds of saving; Give is a job many families add.

Separate jars make a choice visible. One pile of money has no plan. Four jars show your child, at a glance, what they've decided their money is for.

My boys started with three jars, Spend, Save and Give, so the family examples below come from then.

You don't need anything special to start:

• Four clear jars or envelopes, labelled Spend, Save, Give and Grow. Clear jars let younger children see the money add up.
• A weekly time to split new money, ideally right when the allowance arrives. Five minutes at the kitchen table is enough.
• Money that's theirs, such as an allowance. See how to start an allowance and how much to give at each age.
• A goal for Save, if they have one, and one for Grow if they know it. Write it on the jar, or on a sticky note beside it.

Give the allowance in coins or small bills so it can actually be divided. Seven loonies are easier to split than a $5 bill and a toonie.

Gifts and birthday money can go through the same split. Your child decides when the money arrives, the same as with an allowance.

Parents often ask for the right split. There isn't one. A split that suits one child, or one week, won't fit the next.

A child might put almost everything into Save while they work toward a goal, then more into Spend once it's reached. Grow might get a dollar every week, or nothing for a while. All of these are good decisions if your child can explain them.

I didn't give him that split. If I had, he'd have learned to follow my plan. Because he chose it, he learned to make one.

What you can do is ask questions while they decide:

1. 1
   "What do you want your money to do this week?"
2. 2
   "How much is already in each jar?"
3. 3
   "Is there something you're saving for? How long will it take at this rate?"
4. 4
   "Is there anything you want for much later? That's what Grow is for."
5. 5
   "What happens if Spend runs out before next week?"

Then let the answer be theirs, even when it isn't the one you'd choose.

Letting your child choose the split doesn't mean anything goes. You're still the parent. Your job is to set the edges, not the amounts:

Write these down, or say them out loud at the first split. When something comes up that isn't covered, decide it calmly and add it for next time.

Give works best when your child chooses it. If you require a share for giving, it becomes a rule to follow, not a choice to make.

Some weeks your child may put nothing in Give. That's allowed. Some weeks they might put in a lot, because something matters to them.

Money in the Give Jar doesn't need to be spent just because it's there. It can wait until something meaningful comes along.

The split is only half the lesson. The other half is seeing what it led to. At your weekly check-in, before the new split, look back:

1. 1
   "What did your Spend Jar let you do this week?"
2. 2
   "Did it run out? What happened when you wanted something then?"
3. 3
   "How close is your Save goal? How long until you get there at this rate?"
4. 4
   "Do you still want what you're saving for?"
5. 5
   "How much is in Grow now? Do you know yet what it's for?"
6. 6
   "Would you split it differently this week?"

Changing the split is not a failure. It's the point. Each week your child gets to adjust, based on what happened last week.

When a jar runs low, resist rescuing it. An empty Spend Jar the next time they want something teaches more than a lecture. For the moment they want to buy something, see what to say when your child keeps asking to buy things. For the purchases themselves, Was it worth it? has questions to ask afterward. For saving toward one goal, see how to help kids save for something they want.

1. A
   Picking the split for them"Put half in Save" turns their decision into your rule.
2. B
   Praising savers and scolding spendersSpending is part of managing money. Ask about the reason, not the jar.
3. C
   Borrowing from their jarsIf you need change, ask first and pay it back, the way you'd want them to.
4. D
   Requiring a set amount for givingIt turns generosity into a fee.
5. E
   Percentages for young children"Two dollars in Save" is easier to picture than "20%."

These are starting points, not developmental rules. Adjust them to your child.

Their goals show how long a target will take at the rate they're saving, and a giving goal works the same way.

See how Spend, Save, Give and giving work in Monty, read our first month with Monty, or see how Monty O'Clock works.

Monty publishes this guide. Financial education, not financial advice.