I think that’s why a lot of parents aren’t “open” when talking about money with their kids–they never learned themselves. If we had a mantra as a family when I was a kid it was “We can’t afford it”. Just repeat it whenever you had a desire or need expressed in a store. I think that led me to grow up with a scarcity mentality, and a world-view that life is hard, it’s difficult to earn money, etc. I can still remember my dad saying “We don’t waste food in this house”. My wife and I joke about it now when we throw away something fattening or takeout, but for a long time I think it skewed how I look at money and work.
I’ve just re-read a message Sonya/Mrs.Post made on another forum related to financial education. Not sure she posted here too. And as I find her experience and advice on financial education (her field) very good, I’ll post it here. To me, she has a balanced view on this. Check it out.
It is taken from: http://softmozart.com/forum/33-progress-diaries/4284-music-journey-with-my-3-year-old-daughter.html?limit=6&start=24#8393
Hellene does the butterfly thing for motivation. I pay the kids with play money and they redeem it at my store for things like: fruit snacks, balloons, stickers, books, tattoos and other stuff. I go to thrift stores and find good books, and small objects to put in my store and then put a price on it. Sometimes the kids put all their money together to earn things like homemade pizza or cinnamon rolls.My son is approaching the age and your daughter is at the age where money is a great motivator. It is my firm belief that children should be paid for their hard work. We have a system in our house where my children (I only have one that I used this with and will start my youngest this fall when he is 3) are paid for doing their school work, practicing whatever it is they get involved in and things above and beyond chores. I do not pay for chores that is part of living in a family. But all the things that will benefit him I pay for provided he does a good job. Children need to know that the surest way to earn money is to work. I can’t afford that you say. Well, you can if you quit buying things for her and give her the responsibility of taking care of certain things herself. So when my son turns three he will earn $10 a month. I will quit buying things like fruit snacks and anything extra other than birthday and Christmas presents. He has to give $1 a month and save $1 a month and he has to manage the other $8. He has daily and weekly chores to do. Plus he has piano and violin lessons. I don’t pay for chores, but I do levy fines when the chores don’t get done or when they are done sloppily. I levy fines for having to remind more than one time. I levy fines for not trying. My son has had to pay me for making me wait. As the kids get older and are responsible for more, they earn more in their paycheck. As they do this, I also give them more responsibility over their own lives. My oldest son is 17. Right now, I don’t even pay for his co-pay at the doctor. He has to budget for things like that. This was not my idea, I stole it from good friends of mine. This solves a lot of disputes you have in your home if your children know up front that they have to use their money to pay for things. They also know if they want things then they will have to work to earn them. You have to decide what tasks she will earn money for and what you are going to stop purchasing for her. This has worked very well for us. And, when children have to pay for their behavior with cold hard cash, they suddenly develop the habit of attention and you don’t have to nag. the only suggestions I have is that you make sure the kids know exactly how much they will earn and how much the fines are. Never be late in paying them. BTW - I delight in saying, “Thank you for not taking out the garbage, I so wanted an extra five dollars this week.”
Andrea
I think one very important part is being a role model, so educating yourself about personal finance, investments and entrepreneurship. I think “Rich Dad, Poor Dad” is brilliant - agree with others that Kiyosaki’s ideas are simple and he wrote 20 books saying the same thing, but his main book is brilliant and I think every parent should read it. Much more important than learning about savings accounts etc., I think it’s important for kids to learn about entrepreneurship, to not raise them with the mindset that they need to get some job they don’t like some day in order to pay bills. There is a great TED talk by Cameron Herold “let’s teach kids to be entrepreneurs”
http://www.ted.com/talks/cameron_herold_let_s_raise_kids_to_be_entrepreneurs.html
Teaching financial education to our children is not an easy because first of all the we should have to know the grasping power of our child on financial education. Money management is so important for us.
This is really interesting and something I have been thinking about. My DD already has an account which I pay money into and hope she will take over but I had not thought about when or how. I never thought about paying her for things, or fining her. BUT, she does get tiny marshmallows for good violin practice and it helped her get over her toilet anxiety too (2 marshmallows for not holding on too long and having an accident)! If she messes up with either of these I eat one or both of the marshmallows 
. I guess it would be easy to switch marshmallows for cash! I think if that there would have to be a fine for not doing things, not just payment for doing things.
My daughter is already developing a philosophy about money because if she thinks she has lost something she has started to say “just buy another one mummy” which horrifies me! We all want successful children so I guess we need to teach them to manage any financial benefits this success brings.
Growing up, financial matters were hidden from us and we did not know how much things should cost or the value of things. I think it is so important to do the opposite with my daughter. I tell her if something she wants is overpriced in one shop and we will get it else where. I get her involved in shopping lists and will (later) introduce her to some aspects of a household budget including bills. I plan to encourage her to start her own business(es) somewhere along the line. I think it is important for her to have skills that she can use anywhere even if she has no passion for it, so I have in mind a couple of things she will learn to do from about 7-10 years old. I met an 18 year old tailor recently who has never worked for anyone and learned to sew at aged 7. She has always made and managed her own money and can see things going that way forever. It was encouraging.
I also want my daughter to have an entrepreneurial mindset not a worker / employee mentality. I guess considering how to foster this cannot really start too early.
I enjoyed the Ted talk posted by genius experiment. One thing that I am still thinking about a week after watching it is his comment about how he doesn’t pay his children for set jobs but that they have to look around the house, find something that needs doing and then negotiate with him regarding how much he will pay them. I think Kiyosaki talks about the same thing. I had planned to start paying my child for tasks/chores but this really is just teaching them the boss/worker mentality - not that it is bad but I would really like to encourage more of an entrepreneur mindset. It doesn’t come naturally to me though so it is something that I’m going to have to think about and work at.
Jenene, I don’t think I would pay children for doing chores. I think these should be done regardless. I might fine them for not doing them though!
I think re entrepreneurial development this could be modelled by getting them to think about problem solving where possible, also by modelling it even in small ways like not throwing things out but selling on eBay… I dunno. Also teaching them things they can have as a skill and provide as a service. That is top of my list. If before they reach working age they have a sense of earning their own money they should be creative enough and motivated enough to think of ways to take this forward. Plenty of encouragement and support and helping them to deal with set backs should help too