LOS ANGELES (CBSLA) – Millions of parents give their children an allowance. For decades it was paid in cash, but the technology behind kid-friendly debit cards are giving families a new option.
“The earlier that children do learn about finances, the less mistakes they’ll make when they do reach adulthood,” says Zanaya Diakite, who got her 9-year-old daughter Tamia a debit card designed specifically for kids.READ MORE: Grundstrom Lifts Kings To 3-2 Win Over Devils
“I had to take out the garbage, read my books and… wash the dishes,” Tamia tells CBS station WCBS.
Diakite puts her daughter’s allowance and money for chores directly on a customized Greenlight card.
“We really wanted it to be about learning financial literacy, really understanding the fundamentals,” Greenlight Co-Founder and CEO Tim Sheehan explains.
Sheehan says the kids’ debit cards are substantially different from conventional ones.
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“You’re not going to have chores tracking and allowances tied together,” he explains. “Parents can choose which stores and how much can be spent at each one.”
There are several cards on the market that allow kids to get rewards for chores or good grades. That money can be used to make purchases at approved stores, invest or even donate to charities.
“All the features are designed around helping kids learn how to budget, how to understand the differences between wants and needs,” says Dean Brauer, the co-founder and U.S. president of GoHenry.
Andrea Ferguson Peterson says her 10-year-old daughter, London, is into art and fencing and needed a way to be in control of costs associated with her interests.
“I usually tell my friends that I’m saving for this, or that I was going to go here and buy that, because I had saved up for it,” said London.MORE NEWS: Lakers' Comeback Falls Short in 113-107 Loss To Heat
These debit cards typically charge four to five dollars a month depending on the plan.