> - Do I give them the ability to do online purchases?
> - Do I allow them to use up all of their money even as a mistake, or do I set up a limit?
IMHO you should not allow online purchases until a certain age, I would say until 10 years old or so, before that they should ask you for something and you pay for them (if the request is reasonable and anyway if they deserve that).
Starting from 5 or 6 years old you will need to teach them about money (its uses, its risks, how it costs time and sweat to have it), which is something extremely difficult in these times of "immaterial" money, in the old times it was easier, with "real" money kids had their own piggy bank that had its own weight that could be felt, when you opened it there was the ritual to count the coins (and possibly a few notes) and see if it was enough to buy the whatever was desired, a 5/6 years old kid will have difficulties in understanding what the balance of an online account is (that those numbers represent actual money).
When you will be able to allow them to directly make their own purchases (again after some training with you) you should let them spend what they want to spend within a given total budget, i.e. refill a rechargeable card to (say) 100 dollars and give them access to it. (i.e. they should be free to spend the whole 100 dollars on a single, stupid item or buy 5 items 10 dollars each and keep the remaining 50 in the balance, without any intervention by you).
At a given fixed interval (let's say monthly) you credit (still say) 50 dollars more to the card, plus you may credit some more dollars for merit/prizes (if they behaved good, had an exceptional good vote at school, etc.).
This way they will (should) learn that money is a finite amount and that - while one is free to use as he/she wishes - it doesn't come out of thin air.
The problem might be with gifts from relatives, in my times (I was a kid many years ago) I had some uncles that often slipped a note to me (without telling anything to my parents, it was our little secret), now the kid would probably have to "declare" this extra income to you in order to be able to spend it online (and I doubt - but I may be wrong - that modern uncles will recharge the card online directly).
I would only allow them to do online purchases themselves once they turn 14 or so. No restrictions what they spend their money on.
Reduces the risk of them falling for phishing and scams
> - Do I allow them to use up all of their money even as a mistake, or do I set up a limit?
IMHO you should not allow online purchases until a certain age, I would say until 10 years old or so, before that they should ask you for something and you pay for them (if the request is reasonable and anyway if they deserve that).
Starting from 5 or 6 years old you will need to teach them about money (its uses, its risks, how it costs time and sweat to have it), which is something extremely difficult in these times of "immaterial" money, in the old times it was easier, with "real" money kids had their own piggy bank that had its own weight that could be felt, when you opened it there was the ritual to count the coins (and possibly a few notes) and see if it was enough to buy the whatever was desired, a 5/6 years old kid will have difficulties in understanding what the balance of an online account is (that those numbers represent actual money).
When you will be able to allow them to directly make their own purchases (again after some training with you) you should let them spend what they want to spend within a given total budget, i.e. refill a rechargeable card to (say) 100 dollars and give them access to it. (i.e. they should be free to spend the whole 100 dollars on a single, stupid item or buy 5 items 10 dollars each and keep the remaining 50 in the balance, without any intervention by you).
At a given fixed interval (let's say monthly) you credit (still say) 50 dollars more to the card, plus you may credit some more dollars for merit/prizes (if they behaved good, had an exceptional good vote at school, etc.).
This way they will (should) learn that money is a finite amount and that - while one is free to use as he/she wishes - it doesn't come out of thin air.
The problem might be with gifts from relatives, in my times (I was a kid many years ago) I had some uncles that often slipped a note to me (without telling anything to my parents, it was our little secret), now the kid would probably have to "declare" this extra income to you in order to be able to spend it online (and I doubt - but I may be wrong - that modern uncles will recharge the card online directly).