Allowance: do you give one, if so how much and why? There are so many questions regarding allowance it’s difficult to know what to do.
Do you give your teenager a credit card? Some parents do. Do you give your teenager an allowance based on the chores they do? Most do. Do you give your teenager an allowance even after they get an outside job? Some still do.
What’s right and what’s wrong? Well, if you ask me there is no right or wrong in this question, merely what serves your family and what will not.
How much? It’s hard to know how much to give your teen and there are many different philosophies. One common rule of thumb is to give them one dollar for every year of the child per week.
At that rate I’d be giving out $42 per week which is larger than my monthly gas and electric bill – I’d soon be broke myself! Some parent give a credit card to their children that the parent pay off – if this works for you fine. Some suggest to provide pre-loaded money cards so the amount is limited.
To read about different levels of allowance NewYorkMagazine.com has an article where teens themselves explain their personal situation. A very strong argument for giving an allowance to teens is they are at the stage of child development where they are struggling for their independence and identity. Giving them some financial independence may support this very normal development.
Why? What is it that determines whether or not we give an allowance to our teens? Money for chores: this is an age old argument. For every expert that touts giving money for chores to teach financial responsibility and management, there is one that will argue that point.
Robert Kiyosaki, author of “Rich Dad, Poor Dad” writes, “Allowance and chores are a dangerous combination. Gratitude in children doesn’t depend on whether kids have to do chores in order to get an allowance.” The trick with giving an allowance as a reward base for chores is you had better make sure that the reward is good enough, or the chores will never get done. And what happens when your kids “go on strike?”
Our children don’t generally learn from us (including money management) by those things we say to them. They learn from those things they see us doing and they learn from their own mistakes. What works for me and my family may not work your family.
The bottom line is giving an allowance is part of your own personal financial budget. Working this out with your children is showing them how to work with a budget and spend appropriately. So no matter what you decide to do regarding an allowance, make sure you share that decision making process with your children.