Gravy for grades? Experts say beware of pouring it on too thick

A few weeks back, Susan Beacham was returning to the Chicago area from Charleston, S.C. in the family's Toyota minivan when she heard a teenage question that, for many of us, would kill any summer vacation buzz.

"My 15-year-old girl is startlingly bright, but she isn't that excited about breaking loose and coming home with straight A's," says Beacham, CEO of Money Savvy Generation and a financial literacy expert who works with parents and educators. "So she turns to me and says, 'Mom, I'd really love an iPhone.' She's been bugging me forever. 'What if I get straight As?'"

For Beacham, the $500 question (it all depends on which iPhone you get, actually) boiled down to a teaching moment centering on an all-important issue for today's parents, especially at back-to-school time. That is: To what extent should kids expect -- and parents dish out -- financial and material incentives in exchange for great grades?

It's not just parents getting into the act; before he became the U.S. Secretary of Education, Arnie Duncan experimented with and supported cash bonuses for high marks in the Chicago Public Schools system. But the Great Recession -- as well as the gnawing feeling that mounds and mounds of gifts may condition kids to act like salivating Pavlov's dogs -- has parents rethinking the wisdom of gravy for grades.