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Want Money Smart Kids? Give 'em Chores

Want your kids to grow up financially responsible? It turns out that giving them other regular responsibilities, like taking out the trash and doing the dishes, increases the chance that they'll handle their money well too.

A just-released survey found a close correlation between kids with chores and kids who are good with money.

The 2010 Charles Schwab Families & Money survey "cross-tabulated" answers to two questions in this year's survey--one about whether the respondent's kids' had chores and how many household chores they regularly completed; the other asked parents whether their kids were financially responsible.

A full 53% of the kids who had four or more regular chores, from cleaning their room to washing the car, were considered "very responsible" with money; while roughly 46% of those who had 1-3 regular chores were considered very responsible. Only 39% of those who had no chores scored equally high.

On the flip side, 24% of the kids who didn't have household chores were rated "not very" or "not at all" responsible with money, while just 13% of those with chores got bad marks on their level of financial responsibility.

"We are trying to understand what makes for a more successful adult," said Carrie Schwab-Pomerantz, president of Charles Schwab Foundation, which has conducted surveys on Families & Money for the past decade.

In past years, the survey also has found that kids who have summer jobs are more likely to save. Schwab-Pomerantz speculates that when you know how hard it is to earn money, you're less likely to fritter it away. Sometimes household chores come hand-in-hand with an allowance, she added in an interview.

The bad news: Young adults (between the ages of 23 and 28) are far more economically dependent on their parents this year than in years past. Some 41% of parents said they were still providing some level of financial support for their adult children; and 35% expected their kids to be partly economically dependent until they reached the age of 30.

Last year, only 34% of the young adults surveyed said they still "got a little help" from their parents, though some 26% said they were living with Mom and Dad either because they hadn't yet gotten a job, or because they were trying to save money.

Other noteworthy findings from this year's survey: The vast majority of respondents think the recession had a silver lining.

  • 49% said the silver lining was that they learned to live within their means;
  • 43% said they became more involved with their finances, financial statements and contracts
  • 39% said it underscored how important it was to talk to their kids about money
  • 34% learned to save more
  • 12% got out of debt
But 34% said: "Silver lining? Are you kidding, Pollyanna?"

More on MoneyWatch
A Budget Lesson for Toddlers
The Hidden Cost of College
Teaching a Child to Spend Wisely
Financial Literacy: What Kids Need to Know at Every Age

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