One of the biggest questions surrounding an allowance, aside from the should I or shouldn’t I give one, is the amount of money children should receive.
Questions to consider while making this decision:
1) What will they be responsible for with the money?
2) Will it be given in cash form or something else?
In our family allowance is fun money. My children are not required to buy anything they need with it. Lunches, drinks, clothing, shoes, various lessons, sports gear (within reason) are all provided for them. Having an allowance gives them the opportunity to save and purchase things that I would probably say no to. Because does anyone really need another Lego Bionicle set? I think no, but my sons strongly disagree.
This attitude is reflected in the amount of money that my children receive for an allowance. Some might call it a paltry sum of money. But I am a firm believer that it is better to give your children absolute control over a small amount of money. This way they can learn by making small mistakes. No one wants to learn their first money lesson as a semi-adult by blowing $10,000. And even more so, no parent wants to witness it. Small money = small mistakes, Big money= big mistakes.
My children get half their age as their allowance. So my 12 year old gets $6 a week, my 11 year old gets $5.50, etc.
They also do not get actual cash money handed to them for their allowance. Their money is deposited in the Bank of Mom and Dad. I think we all can relate to the experience of having cash fly out of our hands. Spending a little bit here, a little bit there, and never being able to save up for the big things. And yet having no record of where the money was spent.
At the end of each week, we print out a bank statement that looks very official. One for each of them. It lists their beginning balance, their deposits (usually just their allowance, but sometimes birthday money, or money earned from doing extra projects), any withdrawals that they have made, and then their ending balance.
Watching their money grow in their bank accounts has been a good learning experience for them. They are able to see that each little bit DOES add up over time and it encourages them to save and not spend it all every week.
Do your younger children understand the concept of the “bank statement”? We are doing handipoints with 5 and 6 year old boys and I don’t know if they will understand the concept of the paper being tied to a sum of money. We too have decided that half of their age is perfect, but have “strongly encouraged” that a certain amount be saved and a certain amount be for charity. What age do you start allowance…just curious…as we have a 2 year old son also:) Jodi
Comment by Jodi — June 18, 2007 @ 3:22 pm
i think the idea of the allowance being half the child’s age is a great one!(my husband and i have had several different opinions on ammount) the bank statement thing is a good idea too, although i think i will wait to use it with my 5 year old and 2 year old…i started giving my boys allowance when they started asking for money endlessly…which is different from child to child.
Comment by luckycat1997 — June 18, 2007 @ 5:50 pm
[...] left this comment in this post and I thought it was worthy of pulling out for a post of it’s own. Do your younger [...]
Pingback by Mommy Points » Pulled From the Comments, a Question About Allowance — June 19, 2007 @ 9:21 am
Thanks for the feedback on the other post. So…my husband and I disagree about the relationship between the allowance and the chores. My feeling is that kids have chores around the house because we are a family and everyone helps out. I like the handipoints because they can earn things that are free and family oriented that encourage them to actually DO the chores. I believe that the allowance is a seperate tool to help teach kids about money. My husband believes that the allowance is simply a way of “paying” the boys for doing their chores. I do however worry that they might get confused about the handipoints rewards, chores, and allowance. What do you do?? Is your allowance tied to chores??? So, if they don’t do a certain chore do they lose part of their allowance?? Jodi
Comment by Jodi — June 19, 2007 @ 1:40 pm
My husband and I just started an allowance program with our children (one that was suggested by a friend of mine). Once a month (because that is how often my husband gets paid from his job), they get an allowance of half their age. Their allowance is not tied to any chores as we feel they are as much a part of this family and we are and their support is needed to help run the household. We also feel that the allowance is a seperate tool to help teach them about money and would like to encourage them to save their money so we told them that what ever amount of their allowance they decide to put into the bank, we will match.
Comment by Linda — June 28, 2007 @ 8:55 am
[...] left a comment in this post about encouraging her children to save their allowance by matching the money they put into their [...]
Pingback by Mommy Points » The Importance of Saving — June 29, 2007 @ 10:47 pm
I agree with not tying their allowance to chores. I feel that since they are a part of the family and household, that they need to learn that they have a responsibility to pitch in. Mom doesn’t get paid for keeping the house clean, doing their laundry, cooking for them, taxi-ing them to various places, why should they get paid? Mom does all these things because she is a part of the family. (if she didn’t, we’d be living in a horrible state!) They should pitch in keeping their things tidy, taking out trash, emptying the dishwasher etc. It teaches them to think outside of themselves. And really, they really do feel good helping out. The beauty of Handipoints is that it is a great motivating tool-they still get to earn rewards-it’s just a motivator. We also pay a minimal allowance (I LOVE the idea of paying 1/2 their ages-never heard that before), that is not tied to chores. It is money given each week so that they can learn to save, budget and buy those things that I absolutely will not waste my money on! No begging Mom. It also gives them a sense of empowerment.
Comment by handipointmom — April 29, 2008 @ 10:29 am
I WISH I could get my kids to pitch in for the sake of the family. The supporting argument of Mom doing all of those things for nothing makes sense. As a working adult (I’m an at-home Mom), you must do what is required in your job to earn your money. Kids cannot have a real job, so in a sense you are teaching them the responsiblity to EARN their money as opposed to it just given to them. I love the 1/2 your age idea as well as matching funds for saving. Bank of Mom & Dad is cool, too, with the “bank statements”. Thanks to everyone who has posted, I like new ideas!!
Comment by ACE3Boys — May 6, 2008 @ 7:52 am
hey I think that this is a very good idea. my baby is 6 and she is just getting into chores and i have been thinking about allowance..so i think i will start with the bank of mom and dad and do the 1/2 her age..because i did not know what she should be getting.
Comment by bryantmom — July 24, 2008 @ 12:31 am
I have had a hard time having my kids pitch in for the sake of the family too. I spend most of my time with our 6 and 7 year old. I have struggled with their attitudes/backtalk more lately. I found myself asking why are they doing so little and getting an allowance every week? Now they cash in 50 handipoints a week in exchange for their allowance. So they want to earn the handipoints both with helpful chores and better behavior. When we’ve been approached by our 7 year old about a raise in allowance, we just explained that with greater privelege comes greater responsibility…that conversation ended shortly after. I agree that allowance is for the main purpose of learning to be responsible with money. I just don’t want my children to think that they’ll always be given money regularly without some small responsibility tied to it. And now there is no begging in the grocery store check-out line. Just a soft, “Oh man, I wish I had brought my money.”
Comment by Christy — November 4, 2008 @ 12:16 am
I love the Bank of Mom and Dad!! I will get that start NOW! Something I can stick in my purse and have with us when they want something – no trying to remember how much is in the wallet back home. I like the 1/2 age allowance and attaching points to getting it. Doing things just to do them does not work at my house. This gives a little more responsibility to getting it.
Thanks so much for all the great ideas!
Comment by Missy — January 15, 2009 @ 11:54 am
I understand all this but how do I get my handipoints money once I odered it?
Comment by Alicia — March 25, 2009 @ 7:16 pm