Does giving a child an allowance help him learn how to manage money when he becomes an adult? I believe it does.
If a child doesn’t receive an allowance and learn the value of money, I believe he will become a poor manager of his income when he becomes an adult.
Many parents don’t think about teaching their kids about money until they are about to leave for college. I think that is too late.
If you give your kids an allowance, they will begin to learn how to manage money. They will make mistakes, but at least you are there to guide them down the correct path.
Giving them an allowance will also help them to stop and think about how they want to spend their money. They will soon catch on that once the money is gone, it’s gone.
I have noticed that my kids have a greater appreciation for things they purchase with their own money.
I think kids as young as four can begin to learn how to manage money. That’s also the perfect time to start teaching coins and their values.
Some suggest paying them an amount equal to their age each week. That would mean $6 a week for a 6-year-old (or $24 per month). If that is too much, figure out an amount that works best for your situation.
The goal is to teach your child that money has value and how to manage it.
As they get older, create a list of items they will be expected to pay for themselves. This can mean money for clothes, movies, entertainment, etc.
My kids earn their allowances by doing specific chores on a regular basis. However, there are chores that my kids are required to perform that are not tied to an allowance. They are also able to earn extra money by performing extra chores.
Related: Should You Pay Your Kids For Chores?
Some people don’t think that allowances should be tied to chores, but I believe it gets them into the mindset of earning their pay. When they become adults, no one is going to just give them money. They will have to go to work to earn their paycheck.
We also use the 80-10-10 rule where they are required to give 10% to charity, save 10% and the remaining 80% is theirs to spend.
What do you think? Should kids get an allowance? How do you manage their spending? Are their allowances tied to chores? Let me know in the comments below!
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I think this is great advice, Leigh! My sons are getting to the point where they are old enough to start doing chores. I think an allowance shows them the responsibility of working hard and earning money. Thanks for sharing such an awesome post with #SocialButterflySunday! Hope to see you link up again this week 🙂
We use the 10-10-80 method also with our kids. They don’t get paid for their weekly chores, but we pay them for their report card grades. A’s earn $5.00, B’s earn $3.00, and C’s earn $1.00. So, they can end up getting a good chunk of money each quarter. Add in their birthdays and Christmas and I think it balances out to be about the same as if they were getting a weekly allowance. I’m glad to read that there’s someone else who feels it’s okay to pay our kids for the work that they do!
Yes! I feel like it helps prepare them for handling their money in the future. I wish I had that opportunity growing up!
I gave my child an allowance but I am sorry I didn,t tie it to chores
Hey, you live and learn, right? I’m sure they were able to learn money management from the allowances they received.
Thanks Leigh! I am really excited about being a stay-at-home mom (& wife); supporting my family, volunteering, and just living life to the fullest! My husband & I hope to internationally adopt as well, and foster to adopt in the U.S. (once we have more experience with children). When you visited my blog -and I checked your blog out back- I was super excited to see that you were a stay-at-home mom & wife. Most of my closest friends -that I grew up with- are very into the feminist movement. I totally believe in women’s rights, but they seem to see my decisions surrounding children as setting the movement back. Which has been hard. So, I was really happy to see someone else who did (& is doing) what I want to do. I’d love to pick your brain and ask you questions about it someday, if you don’t mind. 🙂
I TOTALLY understand! I’d love to answer any questions you may have. Feel free to e-mail me at SimpleighOrganized@hotmail.com at your convenience. 🙂
I appreciated this article! I do not currently have children, but once my husband graduates from his Master’s program, I hope to be a stay-at-home mother myself. This topic is one that I have been mulling over in my mind. I have heard people mention that you should not tie chores to money (as the children should just help out without incentive), however, like yourself, I still believe kids should become accustom to “working” for things (including their spending money). I like your suggestion, of having chores the children do for pay, and chores that are expected without pay (to contribute to the family).
I definitely applaud the fact that you are planning to stay at home when you have children. For some people, they just dive right in and end up having to go back to work shortly thereafter.
Thanks for your comment!
Hey there! I just nominated your blog for the Bouquet of Three Awards (http://tipsforlivingyourbestlife.wordpress.com/2013/05/10/bouquet-of-three-award/). 🙂
Oh my goodness!! What a pleasant surprise…Thank you!
Leigh
We’ve always linked chores, and otherwise helping around the house, with allowances. 🙂 My kids are 13 and 9 (and 19 months – but he doesn’t count yet 😉 ). The big kids get $5 a week; right now they’re putting most of it aside for spending money, for a trip we’re taking this summer. We don’t just automatically give them $5, though! For any chore they have to be reminded to do, they lose a quarter. Also, if I ask them to do something extra and they have an attitude, they lose a quarter. It works well for us. 😀 They learn quickly that if the job isn’t well done, they don’t earn the full pay.
I like the idea of taking money away when they have to be reminded. I have to start implementing that one. Thanks for your comment. 🙂
So far we haven’t started an allowance with our 8 y.o. She just puts all her money in the bank and never wants to spend it! I would like to teach her this summer about investing and stocks though. I think she would enjoy thinking of a company she knows, like Pepsi/Frito Lay, and following it.
I imagine when she starts to want things like clothes and such we will start the allowance process.
That’s a great idea to add in the investing side of it. I may try that with my 15 year old. Thanks for commenting!
We could even do a couple of posts this summer on kids and investing and give two experiences
I like that idea…sounds like a plan! 🙂
I completely agree with this – my daughter has a star chart where she earns 50p for every 5 stars, and a star for every small chore.
I love your idea about using a chart…it allows them to keep track of their progress. Thanks for your comment!