Three Jars For Spend, Save & Share [Personal Finance]

One of the most important things that young kids can learn early on is money management. Having the kids develop good habits around money sets them up well later in their lives.

There is a neat system which features three jars for spending, saving and sharing. Having the money being split into three categories encourages decision making, financial thinking and it develops some math skills. Alternatives to jars can include envelopes, small boxes, small sealable plastic bags and containers.

(This three jar system can be useful for adults as well for managing money.)

Featured Image Source

Sections

---

• Spend, Save & Share
• Using The Jars With Examples
• Notes
• References

Spend, Save & Share

---

In this three jar system, money is placed inside in the spend, save or share jars. Once the money is placed in a jar, the money should not be taken out.

All of the money can be put into the spend jar but there would be none in the save jar or in the share jar. If everything is put into the share jar then there is nothing in the spend or share jar. You can put one quarter into the spend jar, one half into the save jar and one quarter into the share jar.

Total	Spend	Save	Share
100%	25%	50%	25%

Spending

Spending money involves the exchange of currency/cash for a good or service. Many kids like to spend money on toys and candy. Spending is usually associated with the present time.

Saving

The act of saving involves not spending money right now and having that money stored for later. The saved money is for larger purchases such as a bigger toy, a computer or a phone. Saving is very useful for unexpected emergencies.

Sharing

Young kids may want to use some money to help others in the form of sharing. Sharing includes donations, and gift giving. You can view sharing as a special case of spending.

Image Source

Using The Jars With Examples

---

Many parents give their children a certain amount of money as allowance money. This allowance money may be handed out in regular time points such as every week, every two weeks, every two months and so on.

Students with more money generally have more options while those with not so much money have to prioritize what is important to them and make good financial decisions.

---

Example One

Steve is given $100 as an allowance for this month. He can place $40 into the spend jar, $40 into the save jar and $20 into the sharing jar.

Allowance	Spend	Save	Share
$100	$40	$40	$20

If Steve is more of a saver, he can place $80 into the save jar and have $10 in the spend jar and $10 in the sharing jar.

Allowance	Spend	Save	Share
$100	$10	$80	$10

---

Example Two

Amanda wants to save money for new running shoes. The shoes cost $120 after taxes. In her first month, she receives $80 as allowance. This $80 is split into the three jars as follows:

Allowance	Spend	Save	Share
$80	$10	$60	$10

Amanda does not have enough for the running shoes now. She would need to wait for more allowance money.

In the second month, Amanda receives $70. She has $60 from the save jar which she will take out for the shoes. Amanda decides to spend $60 from this month's allowance with the $60 from last month to purchase the shoes. The last ten dollars is put into the share jar.

Allowance	Spend	Save	Share
$70	$60	$0	$10

This table below represents Amanda's funds in spending, savings and sharing after the purchase of the shoes.

Cumulative Allowance	Total Spent	Savings	Share
$150	$130	$0	$20

Notes

---

• Instead of real money, you can start with fake money such as Monopoly money.
• It is a good idea to start with small amounts of allowance money and then work your way up. (To avoid spoiling the kids.)
• Allowance money can be replaced with money earned from work (household chores).

References

---

• Youtube Video: The best ways to teach your little kids about money
• http://www.threejars.com/home