Dear Dave,

Is it OK to give very young children an allowance?


Dear Christie,

Teaching kids there’s an emotional connection between work and money is one of the best things you can do as a parent. Once your kids are old enough to do a few simple chores around the house, they’re old enough to earn a little money doing them.

In my mind, there’s absolutely nothing wrong with putting kids who are 3 or 4 on a commission system. If they do the jobs you assign them, they get paid. If they don’t do the jobs, they don’t get paid. Keep in mind, kids shouldn’t get paid for every little thing they do around the house. Some jobs are just a necessary component of being part of a family. Once they’ve earned their money, sit down with them and divide it into three separate envelopes — saving, spending and giving. That way, they get to learn about the uses for money while they’re learning how to work!


Dear Dave,

What are your thoughts about online banks? Are they as safe as traditional neighborhood banks?


Dear Jeanna,

Sure, if they’re guaranteed by the Federal Deposit Insurance Corp. The FDIC is one of two agencies that provide deposit insurance to customers in America’s depository institutions. The other is the National Credit Union Administration, which insures and regulates credit unions.

If you’re seriously considering using an online bank, there are a few things I’d advise checking out before making the move. Look into the bank’s track record and see how long it has been open. Also, if the bank you’re considering doesn’t have a name-brand you recognize, find out the amount of its deposits. Online banks don’t worry me today like they did 10 years ago. And almost everyone does some form of online banking these days, anyway. If the bank in question has a good reputation and sufficient deposits to have some strength in its FDIC guarantee, I wouldn’t worry about it.


DAVE RAMSEY is a financial consultant, author and radio host.

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