How can small children contribute to the “family economy”?
Another suggestion I heard on the radio was to give the child the difference between the name brand they want, and the store brand they settle on.  Then that money can be accumulated as savings. Saving money is as important a feature of the family economy as earning money. Be careful with what you have a child do for reward vs what you have them do as a responsibility.  Don't set a dangerous precedent that certain work does not need to be done unless compensation is on the table.  You might have a child who relies on external motivations only to do things, which can make school work and future employment hard. I would instead have my child do yard work, but while doing it explain opportunity costs of doing the work yourself vs hiring out.  I would show my kid how saving money earns interest, and how that is essentially free money. Similar to the lawn care you mentioned: if you have space, you could have the kids create a mini-farmstand. They could grow flowers for cutting, some vegetables, etc. It would be a different twist on the classic lemonade stand. If the kids are into animals and space and zoning allows, you could keep chickens and add eggs to your mini-farmstand. Upfront costs for the garden would be small enough that they can learn about how investing in a business works at a very small scale. Along with learning about money, they also learn responsibility because it requires commitment and daily attention. It's also seasonal in a way that meshes well with school (though having animals is a constant year-round responsibility). "@MrChrister - Savings is a great idea. Coudl also give them 1/2 the difference, rather than the whole difference, as then you both get to benefit... Also, a friend of mine had the Bank of Dad, where he'd keep his savings, and Dad would pay him 100% interest every year. Clearly, this would be unsustainable after a while, but something like 10% per month would be a great way to teach the value of compounding returns over a shorter time period. I also think that it's critical how you respond to things like ""I want that computer/car/horse/bike/toy"". Just helping them to make a plan on how to get there, considering their income (and ways to increase it), savings, spending and so on. Help them see that it's possible, and you'll teach them a worthwhile lesson." There is also babysitting, dog walking and house sitting.  Depending on their age of course. You should also investigate what is required to get them the ability to setup their own Roth IRA.  I know one of the requirements is you can't put more into the Roth then was earned in income in the year.  They might also have to file an income tax return (not sure about that one).  Just think of how far ahead of the game they will be if they can get a couple of grand or more in a Roth account while in their early teens. If you're trying to teach them the value of money and quantifying the dollar difference between prices, one very effective way to do this is by using bar charts. For instance, if a toy is $5, and movie they really want to see is $10, and a vacation they want to go on costs $2000, it can be a useful tool to help explain how the relative costs work. "(Although I disagree with the idea of getting a child working a real job to early, (I think kids should learn at school, learn manners, learn what the world offers and have responsibility) Here is a list of ideas that a small child can do.  This is all assuming the child is to young for a work permit and a ""normal"" job.  I am assuming your live in the United States. Comedy Answer: Amway.  But forget about getting invited to birthday parties."
You remind me a lot of myself as I was thinking about marriage. Luckily for me, my wife was much smarter about all this than I was. Hopefully, I can pass along some of her wisdom. Both of us feel very strongly about being financially independent and if possible we both don't want to take money from each other. In marriage, there is no more financial independence. Do not think in those terms. Life can throw so many curve balls that you will regret it. Imagine sitting down with your new bride and running through the math. She is to contribute $X to the family each month and you are to contribute $Y. Then next thing you know, 6 months later, she has cancer and has to undergo expensive and debilitating treatment. There is no way she can contribute her $X anymore. You tell her that is okay and that you understand, but the pressure weighs down on her every day because she feels like she is not meeting your expectations.  Or alternatively, everything goes great with your $X, $Y plan. A few years down the road your wife is pregnant, so you revisit the plan, readjust, etc. Everything seems great. When your child is born, however, the baby has a severe physical or mental handicap. You and your wife decide that she will quit her job to raise your beautiful child. But, the whole time, in the back of her mind she can't get out of her head that she is no longer financially independent and not living up to your expectations. These stresses are not what you want in your marriage. Here is what we do in my family. Hopefully, some of this will be helpful to you. Every year my wife and I sit down and determine what our financial goals are for the year. How much do we want to be putting in retirement? How much do we want to give to charity? Do we want to take any family vacations? We set goals together on what we want to achieve with our money. There is no my money or her money, just ours. Doesn't matter where it comes from. At the beginning of every month, we create a budget in a spreadsheet. It has categories like (food, mortgage or rent, transportation, clothing, utilities) and we put down how much we expect to spend on each of those. It also has categories for entertainment, retirement, charity, cell phones, internet, and so on. Again, we put down how much we expect to spend on each of those. In the spreadsheet, we also track how much income we expect that month and our totals (income minus expenses). If that value is positive, we determine what to do with the remainder. Maybe we save some for a rainy day or for car repairs. Maybe we treat ourselves to an extra fancy dinner. The point is, every dollar should be accounted for. If she wants to go to dinner with some friends, we put that in the budget. If I want a new video game, we put that in the budget. Once a week, we take all our receipts and tally up where we spent our money. We then see how we are doing on our budget. Maybe we were a little high in one category and lower than expected in another. We adjust. We are flexible. But, we go over our finances often to make sure we are achieving our goals. Some specific goals I'd recommend that the two of you consider in your first such yearly meeting: You get out of life what you put into it, and you will get out of your finances what the two of you put into them. By being on the same page, your marriage will be much happier. Money/finances are one of the top causes of divorce. If you two are working together on this, you are much more likely to succeed. "How do people do it? Firstly, I'd advise you to explicitly budget all taxes. The reason is because taxes get complicated when you have a child deduction. Not that raising a child is profitable post taxes, but it can change your perspective. SIWKs with high income get by just fine. The rest sacrifice. They buy less house, or rent. They drive more than 30 minutes to work every day. They work second jobs. They stop saving for retirement. And when they fail to save or plan, they borrow from family or rack up huge credit card debt. They don't buy the sweet new truck they were planning on. They cut cable and cook meals at home. They skip church, because they can't afford the tithe, and say it's because they don't have time, don't want their children to disrupt services, etc.  So right now, that ""other"" basket is looking pretty juicy, and the taxes can maybe be examined as well. But ultimately, if you're looking at a 30 percent hit in pay, that won't cut it. Mortgage + food alone is nearly half your budget!" Mermaid Baby is swimming in the swimming pool. Mermaid Baby finds different shapes and says their colors.  Learn Colors with Bad Baby Masha and Frozen Elsa with Magic Balls for Kids Children IRL https://www.youtube.com/watch?v=KvJzo7tOTfg  Learn Colors with Elsa, Rapunzel, Belle, Barbie and Mickey |For Children | Nursery Rhymes Song https://www.youtube.com/watch?v=YiABeuqXuhQ  Learn Colors with Masha | Spiderman eats too many Candies and got fat | Masha &amp; The Bear Video https://www.youtube.com/watch?v=JYupa2pc5cQ  Learn Colors with Elsa | a lot of Sweets and Candies | Nursery Rhymes | Finger Family https://www.youtube.com/watch?v=gsnqWmMQW6o  Learn colors with Spiderman and Glasses | Nursery Rhymes Songs for Kids | Finger Family Song https://www.youtube.com/watch?v=bKoY5-nBdRw  #LearnColors #forKids #forChildren #FingerFamily #NurseryRhymes #Children #Songs #Colors #Colours #BadBaby #Mermaid #Disney #FunnyVideo #IRL "The statement can be true, but isn't a general rule. Crashes and recessions are two different things. A crash is when the market rapidly revalues something when prices are out of equilibrium, whether it be stocks, a commodity or even a service.  When the internet was new, nobody knew how to design webpages, so web page designers were in huge demand and commanded insane price premiums. I literally had college classmates billing real companies $200+/hr for marginal web skills. Eventually, the market ""clued up"" and that industry collapsed overnight. Another example of a crash from the supply point of view was the discovery of silver in the western US during the 19th century -- these discoveries increased the supply of the commodity to the point that silver coin eroded in value and devastated small family farms, who mostly dealt in silver currency. Recessions are often linked to crashes, but you don't need a crash to have a recession. Basically, during a recession, trade and industrial activity drop. The economy operates in cycles, and the euphoria and over-optimistic projections of a growing or booming economy lead to periods of reduced growth where the economy essentially reorganizes itself. Capital is a (if not the) key element of the economic cycle -- it's a catalyst that makes things happen. Debt is one form of capital -- it's not good, not bad. Generally cheap capital (ie. low interest rates) bring economic growth. Why? If I can borrow at 4%, I can then perform some sort of economic activity (bake bread, make computers, assemble cars, etc) that will earn myself 6, 8 or 10% on the dollar. When interest rates go up, economic activity slows, because the higher cost of credit increases the risk of losing money on an investment. The downside of cheap capital is that risk taking gets too easy and you can run into situations like the $2M ranch houses in California. The downside of expensive/tight capital is that it gets harder for businesses to operate and economic activity slows down. The effects of either extreme cascade and snowball." Did you account for college? That's 40k per year in tuition alone. Also I'm not sure you accounted that the number included income forgone, as in if they weren't taking care of the kids they could've been earning more money. The article says the cost to *parents* is 900,000 per kid, but that doesn't mean the parents are actually spending 900,000 per kid.   Lots of other things to account for...a couple w/o kids doesn't need to get a 4-bedroom house for example. Does your co-worker own a house? Did you account for the cost of ownership? "Equity does not represent production divisions in a company (i.e. chocolate, strawberry, and vanilla does not make sense).  In Sole proprietorship, equity represents 1 owner.  In Partnership, equity has at least two sub-accounts, namely Partner 1 and Partner 2.  In Corporations, equity may have Common Stockholders and Preferred Stockholders, or even different class of shares for insiders and angel investors.  As you can see, equity represents who owns the company. It is not what the company does or manufactures.  First and foremost, define the boundary of the firm. Are your books titled ""The books of the family of Doe"", ""The books of Mr & Mrs Doe"", or ""The books of Mr & Mrs Doe & Sons"".  Ask yourself, who ""owns"" this family. If you believe that a marriage is perpetual until further notice then it does not make any sense to constantly calculate which parent owns the family more. In partnership, firm profits are attributed to partner's accounts using previously agreed ratio. For example, (60%/40% because Partner 1 is more hard working and valuable to the firm.  Does your child own this family? Does he/she have any rights to use the assets, to earn income from the assets, to transfer the assets to others, or to enforce private property rights? If they don't have a part of these rights, they are certainly NOT part of Equity.  So what happens to the expenses of children if you follow the ""partnership"" model? There are two ways. The first way is to attribute the Loss to the parents/family since you do not expect the children to repay. It is an unrecoverable loss written off. The second way is to create a Debtor(Asset) account to aggregate all child expense, then create a separate book called ""The books Children 1"", and classify the expense in that separate book.  I advise using ""The family of Doe"" as the firm's boundary, and having 1 Equity account to simplify everything. It is ultimately up to you to decide the boundaries." My daughter is two, and she has a piggy bank that regularly dines on my pocket change.  When that bank is worth $100 or so I will make it a regular high yield savings account.  Then I will either setup a regular $10/month transfer into it, or something depending on what we can afford. My plan is then to offer my kid an allowance when she can understand the concept of money.  My clever idea is I will offer her a savings plan with the Bank of Daddy.  If she lets me keep her allowance for the week, I will give her double the amount plus a percentage the next week.  If she does it she will soon see the magic of saving money and how banks pay your for the privilege. I don't know when I will give her access to the savings account with actual cash.  I will show it to her, and review it with her so she can track her money, but I need to know that she has some restraint before I open the gates to her. Here's my opinion.  Families are going to have to hang together more. Since employment is so unstable, they need a way to get through the bumps. Several adults (plus children) living like a clan can do this, and family ties help with the social problems. We already are seeing adult children staying at home now.  Families need to build up capital too. In this new world, anyone who doesn't have some capital (i.e. a piece of the pie) is going to be an utter serf. If you're a serf, it's going to be extremely hard to build it up, most everything will go to just survival. Dividend or rent paying capital gives some independence. Families should prioritize working together to have some, even if it means sacrificing entertainment, eating out, etc.