Can I motivate my kids to excel by paying them?

This is a fascinating question because there's quite a bit of debate in the parenting world amongst experts about the best ways to motivate behavior. The crux of the matter is: if you motivate someone to do something because they'll get paid, aren't you just creating a situation where the only reason they perform is to earn money? What happens when money isn't available, or when you decide you've had enough, or when they get into a situation where they can't be paid for performance in this manner?

On the other hand, we live in a capitalist society and I know that my kids are fascinated by money and always eager to figure out how much a bill costs or how much a check is worth, even if it's in their own terms. I encourage that too, because there's nothing more frustrating than watching a kid who has no sense of money at all waste their allowance, gift money, and even earned money on stupid thing that even they admit were a waste.

On to your specific question... if you're going to pay your children for performance, I think you need to decide whether you want to measure them versus their peers or measure them versus what you think they could accomplish. Drop an honors student into a remedial class, and would an "A" really be worth anything at all?

It certainly seems to me that you could even collaborate with their teachers, working together to identify key areas where each child needs improvement and then offering up a significant and meaningful reward to the child upon reports from the teacher that they have excelled in that area. For example, you value memorizing names, but I take that for granted with my kids. I'm more interested in them learning who they like and avoiding the kids that aren't going to be a good influence. That's its own reward, of course, but it's also something I'd be happy encouraging.

At the college level, I can certainly imagine saying "Keep a 3.4 average or better this year, and I'll buy you a top-of-the-line iPod in June" or an XBOX, or something else that they're going to be able to really keep in their head as a fantastic reward.

Now, the investment issue is something different. My first take on this is to give your son $10,000 in "virtual money" and have him invest in different stocks and then track them all on the market for real. If he loses more than 20% within six months, he has to do the dishes for a month (or something similar, a penalty, but not a big one) and if he gains more than 20% in the same period, you'll then give him $1000 of real money to invest for the family.

Then, if that's lost, well, it's back to the drawing board again. If he manages to make some money, then I'd suggest you apply the profit to funding a family vacation of his choice! A cruise, a trip to Disneyworld, a visit to Aspen for the X Games, it'd be his choice.

Oh! There are a number of virtual stock exchange games on the net, including one that looks really good from the University of Georgia's College of Education: Stocks Quest. It's free, and it's run by a university.

Hope that's helpful. Good luck to you and please do come back in a few months and let us all know how it's going!