When it comes to teaching your children about money management, choosing whether or not you will be giving kids an allowance is important. Every family and child is different, so it really is up to you what system you use to educate your children on how to handle money.
What Age Should I Start Giving Kids an Allowance?
As mentioned above, every child is different. There isn’t necessarily a “right” age to start doling out the duckets. When you decide that your child is old enough to understand what an allowance is, and is ready to start learning about money management, then you can start an allowance.
How Much Money Should I Give My Kids for Their Allowance?
The decision depends entirely on what you want the money to go towards. If your intention is for the allowance to be used towards incidental items, such as candy or small toys, the popular choice among parents is to give an amount equal to their age. For example, you may choose to give a 10-year-old $10 a week.
Alternatively, if you plan on attaching a bit more responsibility with those dolla bills, you may want to consider upping the pay. A good example of this would be requiring your kids to use their allowance for new clothes, or to save up for part of a trip.
Either way, the best rule of thumb is to gradually increase their allowance as they grow older. The more they prove their self-discipline, you may even choose to reward them with a raise.
What Other Kind of Responsibility Should Come with an Allowance?
There are a variety of ways you can use allowance as a way to teach responsibility and life skills, including:
- Work ethic – Many parents believe that requiring your children to do chores in exchange for the allowance helps build a sense of work ethic.
- Savings – You may want to teach the value of savings. Encouraging your kids to set back a portion of their allowance could help them to understand the old adage about pennies saved.
Deciding when to give an allowance, how much is appropriate, and what kinds of responsibilities should be attached to that allowance is all up to you.
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