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Rochester Local

Unlock Money Confidence for Life with Chores and Greenlight

Curfews. Screen time. Chores. Parents and kids don’t always see eye to eye, but one thing they can agree on: the importance of financial knowledge.

According to a Greenlight survey, 93% of teens believe they need financial knowledge to achieve their life goals — and 97% of parents agree. So, why do teens average below-passing grades on the National Financial Literacy Test?

The truth: Personal finance courses are still a work in progress, and other learning materials can be too dry or complex for even the most money-savvy adults.

Learn more and Sign Up for the Greenlight Card!

This is why First Alliance Credit Union has partnered with Greenlight, the debit card and money app for families, to provide real-life, hands-on money skills to kids and parents!

 

Meet Chores and Greenlight — A Game-Changing Money Lesson

Using chores to teach kids about money can unlock money confidence for life. By linking allowances to chores and using Greenlight, kids learn essential money management skills in a practical, engaging way.

Why chores? Chores teach responsibility and the value of work. When kids earn money by completing chores, they understand that money doesn’t come for free. This reinforces the idea that work leads to rewards, a lesson that remains relevant throughout life.

Why Greenlight? Greenlight’s debit card and app take these lessons to the next level. Parents can transfer chore-earned money directly to their kids’ cards, making money management easy and fun. Plus, the app’s features, like chore management and savings tools, enhance the learning experience. Members of First Alliance Credit Union get this service for free, feel free to contact a First Alliance rep if you have any questions.

Contact the First Alliance team to learn more!

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Pros of Using Chores for Financial Literacy

Teaches Work Ethic and Responsibility

When kids earn money by completing chores, they learn that money doesn’t come for free. This reinforces the idea that work leads to rewards, a lesson that remains relevant throughout life. For instance, if an 8-year-old learns to walk the dog for an allowance, they understand that their effort directly translates to earning money.

 

Encourages Financial Responsibility

Giving kids a set amount for chores helps them manage money from a young age. They must decide whether to spend their earnings immediately or save for something bigger. This builds good judgment and planning skills. For example, a child might decide to save their chore earnings to buy a new game rather than spending it on smaller items immediately.

 

Uses Modern Tools for Convenience

Using the Greenlight card for allowances simplifies money management for both parents and kids. Parents can transfer allowances directly to the card, making it easy for kids to access and spend their money responsibly. The app also offers features like chore management and savings tools, which can enhance the learning experience.

 

Cons of Using Chores for Financial Literacy

Potential Loss of Intrinsic Motivation

One downside is that kids might start seeing chores solely as a way to earn money, losing the sense of responsibility toward family duties. It’s important to balance this by explaining that some chores are part of their household contributions, regardless of payment.

 

Financial Burden on Families

For low to moderate-income families, consistently paying for chores might strain the budget. It’s essential to set a realistic allowance amount that fits within the family’s financial limits.

 

Inconsistent Learning Opportunities

If chores are not assigned or completed consistently, kids might miss out on regular financial lessons. Ensuring a steady flow of chores and payments is crucial for maintaining the educational benefits.

 

Implementing a Chore-Based Allowance System

Set Clear Expectations

Create a chores chart listing age-appropriate tasks. For example, chores for 8-year-olds could include making their bed or feeding pets. Older kids might take on more complex chores like mowing the lawn or helping with grocery shopping. Clearly outline the reward for each task to motivate your kids.

 

Use the Greenlight App

Leverage the Greenlight app to manage chores and allowances. Assign tasks through the app, track completion, and transfer payments seamlessly. This not only makes the process easier but also introduces kids to digital financial tools, preparing them for future money management.

 

Establish a Savings Plan

Teach your kids the importance of saving by setting rules for their earnings. A common approach is the 80/20 rule: 80% of earnings go to wants, and 20% to savings. The Greenlight app’s savings feature can help kids visualize their progress, making the concept of saving more tangible.

 

Introduce Budgeting

As kids grow older, introduce more complex financial concepts like budgeting. Give them a certain amount of money for clothing or entertainment each month. This teaches them to prioritize and make informed spending decisions. For example, if they want extra money for a movie, they might need to save from their monthly budget or complete additional chores.

 

Teaching Kids How to Save and Invest

Encourage Saving and Earning Interest

Teach kids about the benefits of saving by showing them how interest works. Open a savings account for your child at First Alliance Credit Union or use the Greenlight app’s savings feature to help them track their savings and see their money grow. Explain that the money they save can earn interest over time, increasing their savings without any extra effort.

 

Using Savings to Fund a Business

Introduce entrepreneurial skills by encouraging kids to use their savings to start a small business. For example, a 12-year-old could save $100 from chores to buy a basic lawnmower. With this equipment, they could offer lawn mowing services to neighbors, charging $10 per yard. If they mow five yards a week, they could earn $50 weekly. This teaches them about investment, profit, and the value of hard work.

 

Set Realistic Goals and Plans

Help your child set realistic savings goals. If they want to buy something expensive, like a bike for $200, teach them to plan their savings and earnings. By saving part of their allowance and adding extra income from occasional jobs, they can reach their goal within a few months. This not only teaches patience but also the importance of planning and perseverance.

 

Money Skills for Today, Tomorrow — and for Life

At First Alliance Credit Union and Greenlight, financial literacy for kids and teens is the name of the game. That means finding new ways to empower them with money skills, knowledge, and confidence.

Using chores and the Greenlight app, kids get a head start with hands-on learning — and put their skills to work in real life as they learn to navigate the world of money. We’ll be cheering them on every step of the way.

Want in? As a First Alliance Credit Union member, your family can join Greenlight and start learning hands-on, real-life money lessons for free. Sign up today, greenlight.com/facu

 

Sign Up for Greenlight

Get Greenlight Today

First Alliance Credit Union members are eligible for the Greenlight SELECT plan at no cost when they connect their First Alliance Credit Union account as the Greenlight funding source for the entirety of the promotion. Subject to minimum balance requirements and identity verification. Upgrades will result in additional fees. Plans start at $4.99/mo. Upon termination of promotion, members will be responsible for associated monthly fees. See terms for details. Offer ends 08/16/2024. Offer subject to change or renewal. Card images shown are illustrative and may vary from the card you receive.

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