I started giving my kids an allowance when they were 2 years old. They get $1 for each year of their age. They also have to give back 25 cents for each dollar. I've explained to them it's kinda like taxes. It's money you've earned, but you don't get to have it. The money goes into a bank account in their name that I have told them they get when they turn 18. They can spend it on a down payment on a car or anything else. They understand that if they want something that costs $30, they will have to save up more than that to cover sales tax. At a far earlier age than most kids, mine have learned the value of money. When most other parents were parents were having to deal with little kids having a hissy fit in a store for a toy, all I have to do is explain to them that they don't have enough enough money saved for the toy that they wanted. My kids understand the value of saving. Their allowance is not dependent on any chores as I wanted to teach them value of saving money. They do not get anyt money for daily chores, but when I need them to do extra things, I will pay them. This has also tuaght them the value of work. I am very proud to say that at an early age, I have taught my kids the value of saving and earning money.

Not a bad idea, I guess. If you're giving out an allowence, anyway. I never gave one to my daughter, period. She could *earn* up to one dollar a week by doing various household chores, and that amount could be decreased if I didn't like the job she did. But I never thought of introducing a tax system, and I probably should have.

The reason I did not want to couple the weekly allowance with chores was because it would have limited opportunities to learn the value of saving. It's worked very well and I'm sure I won't have kids who kill their credit scores when they go away to college. Here's how I do it. My son is 7 so each Wednesday, he gets $7. Of that, he has to give me back the amount of 7 quarters, $1.75. That amount is put in a piggy bank which I later deposit in a bank account in their name. If there is an expensive item that he wants to save for, he gives me however much of the remaining $5.25 to put in a savings envelope. Lately he has only been keeping $1 because he is saving up for a Nintendo 3DS game. By squirreling away Christmas and allowance money, my 7 year old son saved enough money to buy a new nintendo 3DS.