Practical Parenting – Time for an Allowance?
Now that we have covered some basic ideas and suggestions as to the idea of chores for children, it’s time to consider how they may relate to giving allowance. If one follows most of the literature on this topic, they don’t. In other words most basic tasks done by all of us within the home achieve the goal of keeping it a safe and healthy place to be. Instead, allowances can be wonderful teaching tools when not tied to chores. When children are somewhere between the ages of six and eight, they are ready to learn firsthand how to spend, budget, and save wisely.
How much do you give a child for an allowance? It depends to a large extent on the child, level of maturity, particular needs in terms of school expenses, hobbies they enjoy, clothes they like to wear, toys that stimulate them, and your personal financial circumstances. Right from the start this can be a great place to do some zero-based budgeting by sitting down with your child and going over these wants and desires. Before an allowance is started, set aside a month and log how many times your child asks for something. The response can be, “Honey I’ll buy it for you now, but the next time you want to purchase something like this, it will be with your allowance.” Keep in mind that your ultimate goal is to return to parenthood and cease being a very convenient ATM machine. More importantly this process can be started at any age!
If that seems too time consuming, you can work backwards by establishing the allowance first and see how it plays out. Mrs. Volker and I took this approach and decided that from age seven or eight until age thirteen or fourteen, one dollar per year of age paid monthly was an appropriate amount for the expenses they were asked to assume. In today’s dollars, that could be three or more to one.
Not only did this system teach them how to handle money, it gave us an easy retort when they wanted something that was not within our budget or was deemed extraneous. When that item inevitably came up, our standard response was to remind them that they had their own money, so if they wanted it badly enough they were free to buy it, or better yet, save for it. It was amazing how many times those items were never purchased, as they soon became much more careful about spending their own money than they ever were about spending ours.
But do consider paying your kids for special jobs. One-of-a-kind big jobs like painting, cleaning out the garage, washing the car, or spring yard cleanup are also good opportunities to earn some extra money. When children are in middle school, they can begin working for others you trust – a relative or close friend. This is where extra work is tied to extra money and the work ethic is further developed. In closing, never discourage the entrepreneurial spirit. Lemonade stands are great – just make them buy their own ingredients!
Friday December, 12, 2014
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