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As a parent, there are so many things you’re responsible for teaching your child. Some occur quite early in life, while other lessons tend to come a little later. Giving your child an allowance has long been seen as a way to teach them about money, budgeting, saving for a goal, responsibility, and what it means to help out and have to work for that money.
If you’ve been thinking it may be time to introduce an allowance into your child’s routine, but aren’t sure if they are old enough, you may find this information and advice to be helpful in making up your mind.
Why Do You Want to Give Them an Allowance?
A good place to start when trying to come to a decision about allowances is to ask why you want to give it to them in the first place? Most experts would agree that the purpose behind an allowance is to teach kids about money. If you don’t give them money, then they can’t possibly learn on their own to budget, save, and what it feels like to spend their own money.
In previous generations, kids didn’t have to think about money until adulthood. Now, things are different. One look at a number of teenagers who are striking it big in the tech world and other industries shows that learning about money is a necessity from a young age.
Even if you start to think about their future school, money will come into play. Perhaps you yourself have gone back to school and maybe you’re working on getting your masters in social work online. Obviously, this took thought, research, and saving so that you could afford the MSW programs online. These are all skills you learn through budgeting.
Stop Worrying about What Others are Doing
Another mistake parents make is to look at when their friends have started giving their kids an allowance. Again this is all built on the wrong foundation. If it’s truly about teaching kids about money, then the earlier you start them on an allowance, the better. The actual amount you give them and the chores you ask of them become secondary.
If you’re having a hard time coming up with an amount, a good tip to use is the age calculation. You can give the child one dollar for every year that is equal to their age. If you have a six-year-old, they would get $6 allowance on a weekly basis.
What is the Allowance Used For?
When it comes to what the allowance is used for, this is something that should be made clear to the child from day one. Parents should always be responsible for the necessities (clothing, school supplies, family outings, lunch money, etc.), and then those items that aren’t necessities are up to the kids. For example, maybe they want the latest video game that all their friends have. This is exactly what they can use their allowance to save for.
Providing Them with Money Skills and Understanding
An allowance shouldn’t be thought of in terms of its value, or what kids are even doing to earn it. Instead, focus on the foundation it is giving them when it comes to money skills and understanding.