Dear Mr. Dad: In today’s tough economy, I think it’s important to teach kids about the importance of saving money. The problem is that my husband and I don’t agree on how to do that. I think we should give the kids (10 and 13) an allowance, but he’s taking a harder line and says it’s important for them to earn their money. What’s your opinion?

A: Ah, allowances. Always a thorny subject. Before I jump in and start taking sides, you’re both absolutely right about one thing: People who develop good financial management habits as kids (including learning to become regular savers), are more likely to bring those habits with them into adulthood. And knowing how to manage one’s money—especially in uncertain times—is incredibly important. The big question, though, is how people get their money. Here’s where I agree with your husband. In my view, when you work hard for your money, you’re going to be careful how you spend it. When cash just shows up, it’s a lot easier to fritter away.

I’m sure you’ve experienced this in action. Have you ever found $20 in the pocket of a jacket you haven’t worn for months or years, collected on a sports bet, or won a few bucks on a lottery scratcher ticket? If you’re like most of us, your first reaction is to go out and spend your unexpected windfall, not put it in a savings account. (Unfortunately, too many people do the same thing with tax refunds. The money, of course, is theirs—they’ve just loaned it, interest-free, to Uncle Sam. But because they’ve managed to get along without it for a year, it feels like a gift.)

The same is true with kids and allowance. When children get money simply for being alive and don’t do anything to earn it, they’re going to go out and spend it. Oh, and it gets worse from there. The bigger the allowance, the less likely the kids are to save any of it. In fact, a tiny increase—just 1 percent of the amount of the allowance—reduces by 22 percent the chance that a child will save, according to Sarah Brown and Karl Taylor, researchers at Sheffield University in England. On the other hand, Brown and Taylor found that while kids who earned their money still spent some of it, they were also a lot more likely to save.

Okay, now on to the practical end of things. How are your kids going to earn their money? Child labor laws and school truant officers will keep them from getting full-time jobs, but they still have plenty of options, which fall into two broad categories: outside and inside. Outside jobs could be things like watering neighbors’ plants or washing their cars, dog or cat sitting, babysitting, paper routes, and even old standbys like selling lemonade and brownies. Inside jobs could include things like helping you install insulation in your attic, organizing your files, and maybe even teaching you how to make better use of your smartphone or tablet (some of these inside jobs could become outside ones if they do them for other people).

Just as it’s important to make a clear distinction between getting an allowance and earning money, it’s also important to make a clear distinction between inside jobs and chores. Chores are tasks that your children should do simply because they’re part of a family, things like cleaning their rooms, setting and clearing the table, sorting laundry, walking the family dog, vacuuming the carpets, taking out the garbage, and so on. And because everyone in the family has an obligation to keep things running smoothly, chores aren’t paid.

If you’re interested in other ways to teach kids about money (other than the allowance debate), you might want to check out Kids’ Money.