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Ok, I have a question for you folks who put the kids' allowance on a prepaid Visa card. Doesn't that encourage them to spend every penny of it? How do they get money from their allowance for saving for something big or something later on down the road?

No more than handing them the cash I guess.

Ours is 8. He makes $5 per week (and does a lot for his age to earn it). He gets it added to his card every other week b/c $10 is the min I can add. He earns it and can do what he wants with it within reason. If he doesn't do all of his chores, he doesn't get his allowance.

If he wants something, he saves by not spending & letting his balance build up.

To him it looks like an online bank acct with a debit card - think of it that way & not as a credit card.

He has to not only decide what to save & what to spend, but he has to keep track of the available balance, so we feel he's learning a little more than just managing a handful of cash until it's all gone.

We don't force him to save and typically he won't unless there is a specific item or goal he has. When he goes into "saving mode" for something, he won't spend any money until he has enough to get whatever he was saving for. If he has no particular goal, what money he has is typically wasted on junk. He's just not at the point yet to understand the concept of saving "just in case". The behavior would be the same if it were cash in hand or available balance on a debit card, so i don't see any harm in giving him his money this way.

When he gets a little older we'll work on save some, give some, spend some, but for right now we're letting him make his decisions and gently pointing out things he could do differently. Every once in a while it clicks & he realizes if he hadn't spent his money on something wasteful yesterday, he'd have it to buy something better today
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