How do you help and encourage your kids to manage their money.

[Astrid]

Similiar stuff has crossed my mind. DH and I have arguments, as he wants us to put a lot of money in the girls account each month. I put in a small amount, but he wants it to be larger. Like you, I see getting the mortgage paid off as a priority. It benefits the whole family, the sooner we have that paid off. They get enough to ensure the bonus interest kicks in each month, as there always has to be 1 deposit.

I have been tempted like you, to have the girls money sit in the mortgage. MIL caught wind of that and got upset, which I understand, as some of the money as come from her. It does involve a whole level of trust, that we as parents do the right thing, but I suppose that also applies to where we are trustees of their accounts. I have, in one time of need, borrowed money and then returned it plus extra (Timing issue with new tyres and tax returns). It takes a lot of discipline and honesty to always remember it is their money.

The main thing to consider is the legalities of it. If everything goes bad and you lose your house, well they lose their money. If it is kept in trust for them, it should at least protect it for them. My father has accounts set-up for the girls and he did this on the advice that the money would be theirs, no matter what happens with his will when he passes.

As for the control thing, at this stage that money is for when they hit Uni age to help out if needed. We may revisit that over the years. When they are a bit older they will get their own everyday savings account for pocket money etc. Will probably see a financial planner when the amounts are over $5000 each to see what they recommend