Instilling the value of money and establishing a grounding in sound financial principles at an early age is probably one of the most important lessons parents can provide for their children. Just how to provide it is the difficult part. Paul Lermitte’s Allowances, Dollars and Sense attempts to lay out a plan for parents that will do just that.

Lermitte, a financial planner, uses a workbook format popular with financial professionals to guide the reader through the process. He tries to stress the pitfalls of raising children to be financially aware and responsible in an age where they are surrounded by ATMs, debit cards, and slick marketing.

Lermitte refers to his trademarked methodology as “The Making Allowances System,” and attempts to create a plan for both parents and children based on the building block of the weekly allowance. He begins by outlining the consequences if sound money-management techniques aren’t learned at an early age – such as the debt trap, or having children remain financially dependent on their parents in later years. Sample contracts are provided for setting up written agreements with children with respect to allowances, savings, and loans, all with the goal of imparting responsibility. Lermitte briefly covers a wide variety of topics, such as setting up a Registered Educational Savings Plan (RESP) and investing in the stock market. Unfortunately, rather than giving any fresh insights into these many areas, the focus is too broad to provide clarity on any one area.

Granted, the concept of allowances and spending for children is more complicated today than in earlier times. However, Lermitte’s system for raising financially aware children is merely a reworking of old common sense principles.