Virtual bank accounts allow parents to deposit allowance online and teach kids about spending and saving.
Virtual bank accounts allow parents to deposit allowance online and teach kids about spending and saving. - 
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This is how allowance works in the Skyvara household: Each week, Suzanne Skyvara and her husband dole out $7 to each of their two sons. Except, like a lot of money these days, this isn't cash. It shows up as a number on a computer screen.

In their house near San Francisco, Suzanne and her 8-year-old son, Michael, are looking at a site called FamZoo on her laptop. It shows how much of Michael's allowance he's saved and spent, and no transaction goes unrecorded.

"Look! Lost bet with Tom, your big brother," says Skyvara.

"About a video game. We were betting what the name was," responds Michael.

These sites are kind of like online banking for kids, complete with graphs and charts. Skyvara had longed for something like this. She and her husband wanted to instill some financial responsibility in their kids, in part to make up for the mistakes of her younger years when she spent her entire paycheck each month.

"Nobody had ever told me or sat me down and said, 'OK this is what you have to do. You need to put this amount in your savings, and you should be thinking about this for the future.'" says Skyvara.

Some of these sites are designed to teach lessons about saving and charity. Michael deposits $1.75 into four categories in his virtual bank account.

"I have a quarter for college savings, a quarter for money for the poor," he says.

If you think that's responsible, Michael's older brother is even saving for a house. He's 10. So, each son can see exactly how much he's saved. And, when one wants something -- say, a soda at a restaurant or the latest video game -- Suzanne and her husband can pull up the FamZoo app on their phones, and show their sons the balances in their account. Then, Michael and his brother have to decide whether to spend or save.

This process doesn't just help kids, parents benefit too -- never forgetting to give an allowance. But because these accounts are virtual, Skyvara says she has to make sure she has real money to back the allowance savings.

"Once those numbers start getting bigger, you have to be prepared for them asking you for the $600 for something," she says.

It can get up to $600 because, to encourage savings, Skyvara pays her kids a stellar 5 percent interest rate per month.

But so far, the Skyvaras are mostly the exception. Despite the slew of start-ups offering allowance tracking, Stessa Cohen, a research director at the technology research firm Gartner, says they remain niche.

"What's the business model for it?" she asks. "But potentially, it's capabilities that banks could incorporate into their product offerings both existing and new."

For now, these stand-alone sites rely on subscriptions, advertising, or tie-ins with online stores. But Cohen expects these sites to take off once they're tied to real banks. One day, you might see your kid's allowance as a direct debit from your account.

But Beth Kobliner, author of "Get a Financial Life," is skeptical about this digitizing of the allowance. She says if you want to teach kids about money, use cash.

"I think there is a benefit for children maybe seeing a parent run out of cash one day, to realize, oh, I need more cash. I can't buy everything I want just because I have a piece of plastic. I have to have the money to pay for it." she says.

Kobliner worries some of these sites, which are connected with online stores, could lead kids to spend more and save less.

But Cohen sees the utility of the virtual bank account. Besides researching the industry for Gartner, she's realizing it could help in her family. Her son, Erez, says his mom is a bit behind on his allowance.

"Yeah, by about one year," says Erez.

He better hope she pays interest.

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