Roundtable Discussion – Kids’ Allowances

1 Oct

I think all parents can agree that it’s important to teach children responsibility when it comes to handling money, but how do we go about doing that?  Typically, most children first experience the power of earning and spending from getting an allowance.  But what should the guidelines be for doling out cash to our little ones?

I’ve heard that many parents give their children an allowance for doing household chores, but the counter-argument to that idea is that children should do chores not for the expectation of receiving money, but because they are members of the household.

Some parents just give their children a regular allowance, with “no strings attached.”  Some require their children to save and donate certain portions of any money they receive.

My kids are 4 and 2, and I haven’t started giving them an allowance yet.  With so many options, I’m not sure how I want to go about it!

What kind of allowance arrangement have you implemented within your household?

Please share your ideas – we want to hear from you!


5 Responses to “Roundtable Discussion – Kids’ Allowances”

  1. elderwiggins October 1, 2010 at 2:31 pm #

    Allowance in our household was not considered until the kids were older, starting around age 10. Each member of the household has “chores”, but this is an expectation as a member of the household, as you stated. They are also expected to maintain their schoolwork/homework assignments and keep their rooms clean.

    The allowance was given as a reward if they did a good job handling their share of the household responsibilies. The amount depended on their age – giving them something to look forward to; as their responsibilities increased, the allowance increased. It gives the children an opportunity to learn to save to buy their “wants/desires” versus the “needs” that mommy and daddy provide. Allowance can also be suspended should they not uphold their part of the “agreement”.

    Allowance should be a series of teachable moments on financial responsibility, distinguishing between wants/desires and needs and accountability for your actions (or lack thereof), not just a way of milking mom and dad for funds. These are just my thoughts as a mom of 5.

    • Lori October 1, 2010 at 11:57 pm #

      Great thoughts! I like the idea of the amount increasing with age!

    • Jen October 5, 2010 at 3:18 am #

      Great insight, elderwiggins! I also like that idea of increasing the amount as the child gets older and takes on more responsibility – and the fact that the allowance is a reward, but not a direct payment for chores.

      And I definitely agree with you that allowances should be in place to teach the kids about money. Lisa, you clearly got certain messages from your mom about money that stayed with you into adulthood!

      Lori, I cringed at the story about your 2-year-old wanting a dollar to help your mom, because I can see how easily you could get to that point! When my mom comes over, my 2-year-old immediately says (even before “hi”), “Did you bring me a donut?” It’s the same principle, about expectations! I’m sure they will learn in time, and it’s nice to know I’m not the only one who’s not ready to start with an allowance on their (almost) 5-year-old.

  2. Lisa Martin October 1, 2010 at 3:48 pm #

    I am the first one to admit I have a warped view of money! I wonder if I could blame my parents. Maybe, maybe not.

    They tried their darndest to instill good financial habits in me from a young age. My first allowance was a dollar a week when I was six. They gave it to me in quarters with the understanding that I’d put the fourth into the collection plate at church every Sunday. I remember resenting it, but complying.

    My allowances were never tied to chores, which my folks wanted me to do just because I was part of the family. (They might pay me to do something special, like wash the car.) When I was in high school and continually trolling the mall with my friends, my parents tried a different tact. They gave me $300 a month, but I was to buy my clothes from that.

    Problem was, I began asking for “advances” almost from the get go. And my mom would fork them over to me. In hindsight, I see how that might have helped set me up for trouble when it came to my first credit card. I loved, loved, loved the idea of buying now/paying later.

    Not so much these days. A couple of years ago, I worked myself into a frenzy to pay off all of our debt, minus the mortgage and a car payment. I suspect if I calculated all the interest I’d paid to Visa and MasterCard over the years, I could spend a month living in the Four Seasons on Maui and still have money to burn! I get a little queasy when I think about it.

    I also see myself repeating a pattern. Our 5-year-old already takes an interest in cash. (He can tell you George Washington is pictured on the $1 bill.) I was hoping to push the allowance issue off for another couple of years–until I have a clear idea in my mind about the best approach for him.

  3. Lori October 1, 2010 at 11:55 pm #

    I have not started giving my kids an allowance either; they are 5, 2, and 3 mos. My mom allows the older two to do extra chores around her house such as pulling weeds, helping wash the dog, cleaning up their playhouse, picking up leaves, and sweeping. Each time they help her, they earn about $1. So far, my 5 year old has saved every dime. She doesn’t ever want to spend it. I help my 2 year old put her cash in a piggy bank, because otherwise it would end up lost somewhere in a couch cushion in my car, or some other crevice. At first I thought it was a great idea for them to be earning some money, but then my mom asked my 2 year old to carry a bag into the house, and my daughter responded, “Are you going to give me a dollar?” When my mom said, no, you just need to take the bag, she responded, only if you give me a dollar. At her age (2), I’m not sure she’s able to grasp the difference between doing something helpful, that is expected of you, for the common good of the family, and doing something extra for money. My parents never gave my siblings an allowance. I was probably about 8 before I had any real chores though (like being responsible for the cleanliness of a given room). My kids have some chores, like putting their clothes in the hamper, picking up toys, making sure their rooms are neat, and clearing their plates after dinner. My husband had an allowance much like Lisa did, even in college he got a lump sum every month. He was extremely responsible with money and still is. I really like the school my 5 year old attends. They are teaching the kids all about saving, spending, and giving. When they have good behavior, do a good deed, or do extra work, they earn coins. They are responsible for their own coins. They can choose to save the coins, spend the coins on a treasure, or give the money to a friend who might need one more for whatever reason. The class can also earn “corporate dollars” when they are spotted being nice, quiet, or good as a whole, by another teacher or someone else. The corporate dollars are saved until they have enough to make a purchase for the benefit of the entire class (like a new game, puzzle, or music) for their classroom. The whole class deliberates and must come to an agreement (however they wish) as to what they will purchase with the corporate dollars. I for one, completely underestimate what the kids are capable of doing. I was in the kindergarten classroom today and they do everything by themselves. They clean up after themselves and in the lunchroom, they get their own food and drinks. I wonder why the teacher has no problem getting my daughter to cooperate with the clean up, while all I get is a whiny complaint?!!

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: