Learn something new every day
More Info... by email
Deciding whether to give a child an allowance is truly a decision best left to his parents. There are a variety of factors to consider when making this decision, such as how much to give, whether to give it in exchange for doing chores around the house, and how old a child should be before he starts receiving an allowance. Those who support giving children an allowance say it will teach them how to handle money, including saving, which will help them as adults. People who disagree with the idea say children should not be paid for doing household chores and that simply having money doesn't mean children will learn to properly manage it.
The benefits of giving children an allowance are numerous, and there are many lessons they can learn once they are in charge of their own money. Learning responsibility and how to stay within a set budget are two things children can learn from having money. A monthly allowance allows children to see the importance of making smart purchases and learning how to fit everything they buy into their monthly budget. Children can also learn about saving — primarily that, if they save their money for a few months, they can purchase much better things than if they spend all the money they are given as soon as they get it.
An argument can also be made for why children should not receive an allowance. One common reason is that children will not be responsible and will buy things their parents consider to be a waste of money. Even when receiving an allowance, children sometimes will see an item they want and realize they do not have enough money to buy it. This could lead to complaints that they do not receive enough money and should have their allowance raised.
Part of deciding whether to give an allowance includes thinking about how it will work if one does. Parents need to decide how old the child should be before he begins receiving such funds and how much money he should be given. Generally, children in the 3- to 5-years range show signs of understanding how money works. When determining how much to give, a good rule of thumb for younger children is to give them money according to their age. That means a 5 year old would receive $5 US Dollars (USD) a week or month, depending on how often the allowance is distributed. As children get older, their expenses increase, so it is best for parents to sit down with their children and decide what they need and give them money based on that.
Whether children should be paid for doing chores around the house is a debatable topic, and there are reasons for and against it. Supporters say children who are paid for doing chores learn the value of getting paid for doing good work, which will help when they are adults and have a job. Others feel children should not be paid for chores and, as part of the family, should help out around the house just like everyone else does. Another consideration is whether the only punishment for not doing chores is not getting paid. If so, children may choose not to do them, especially if they do not need the money at the time.
When deciding whether to give children an allowance, it is best to weigh the benefits and the risks and then make a decision. Talking to other parents may be helpful, and they could offer further advice based on how they handle the issue with their children. Keep in mind, though, that what works for one family may not work for another, and the allowance decision should be based on what works best for one's particular situation.
My wife and I discussed the issue of an allowance for our kids. I was of the opinion that an allowance didn't have to be tied to household chores. I felt comfortable giving each child 5 dollars a week and letting them go to the mall on Saturday to spend it. If they wanted something that cost 10 dollars, they would have to wait another week to buy it. If it was something important, however, I would pay the difference so they at least had what they really needed.
My wife really wanted to set up a list of chores and a list of prices. The harder chores would pay more money, and the kids would line up on
Friday for their "paychecks". We compromised and decided that the kids would get a steady allowance from me until they were old enough to take on the harder chores. Once they were old enough to vacuum the carpets and wash dishes, then we would start my wife's chore chart idea.
I think if you decide to give your kids an allowance, you need to let them make their own decisions about spending it. When I was growing up, my dad gave us a dollar a week. This was at a time when a dollar could buy a lot of things, like a 45 record or an ice cream cone or "penny" candy. I saw that dollar as my money, since I earned it through chores.
My dad would scrutinize and criticize every last thing I bought with that money. If I bought a record for 49 cents, he called it a huge waste of money. If I bought candy at the neighborhood store, I was just throwing my money
away on junk. It didn't matter what I spent my allowance on, it was going to be wrong or wasteful. To this day, I feel like I have to justify anything I buy to everyone around me. That's not a good way to be.
I say if you give a child an allowance, the best thing you can do is let them spend it on whatever they think will make them happy, at least at the time. Let them figure out on their own that something like candy is a temporary pleasure, but a new pair of gloves would be more useful. Don't make him or her feel bad for spending money on the same things every other child is allowed to buy.
One of our editors will review your suggestion and make changes if warranted. Note that depending on the number of suggestions we receive, this can take anywhere from a few hours to a few days. Thank you for helping to improve wiseGEEK!