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Everyday Cheapskate: 5 Reasons to Give Kids an Allowance

Mary Hunt on

HOW OFTEN?

Whether it's weekly or monthly, kids do better when you stick to a schedule.

Younger kids tend to manage their money more effectively when they get it weekly, since out of sight often means out of mind.

For older kids, consider a monthly schedule so they can learn about budgeting.

WORK FOR PAY?

Think about your goals when it comes to the allowance-for-chores quandary. If your main goal is to teach your kids to manage money, give them a basic allowance with financial chores attached, such as paying for their own collectibles. If you also want to teach kids the value of working for pay, pay them for extra chores on a job-by-job basis.

BACK OFF

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The purpose of an allowance is to teach kids to self-govern money. Encourage kids to save a given percentage and set aside a percentage for charity (they'll learn the value of giving back). Then give them the freedom to decide how to spend the rest.

PHYSICAL BANK

Want to get your children's allowance program off to a great start? Make sure they have some kind of physical bank, box or jar that will help them divide and manage their money. Consider the Moonjar classic moneybox. This clever savings bank is actually three banks in one to teach children to save, spend and share their allowance.

If you want to know more, I'd encourage you to read my book "Raising Financially Confident Kids." It tells the story of what my kids learned from receiving an allowance, details our plan and is as relevant and practical today as it was when we first came up with it years ago.

Mary invites questions, comments and tips at EverydayCheapskate.com, "Ask Mary a Question. This column will answer questions of general interest, but letters cannot be answered individually. Mary Hunt is the founder of Debt-Proof Living, a personal finance member website and the author of the book Debt-Proof Living, Revell 2014. To find out more about Mary visit the Creators Syndicate Web page at www.creators.com.

Copyright 2019 Creators Syndicate Inc.
 

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