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Saturday, February 28th, 2015


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Making Allowances: Kids & Money

Experts say there’s no single, right way to approach the big allowance debate. Here are some methods to consider.

Commission for Work

How it works: Kids earn money by completing household chores — 50 cents per task, for example, or a set fee for the week’s work.
Best for: Families who want kids to learn how the world functions: If you work, you get paid. If you slack off, expect to be broke.
Pros:

  • Helps kids develop a healthy work ethic and prepares them for their first job.
  • Encourages entrepreneurial thinking: Kids who want more spending money negotiate extra jobs to earn it.

Cons:

  • Kids may choose not to do chores when they don’t need money or after they get a “real job.”
  • They might resist doing other, unpaid household tasks.
  • Kids may think chores, such as washing dishes, are optional once they reach adulthood. They don’t realize that such daily tasks don’t always come with monetary reward.

Share of Family Income

How it works: Kids automatically receive a set allowance that is not tied to household tasks.
Best for: Families who feel kids, as part of the family, should pitch in the household’s responsibilities — and rewards.
Pros:

  • Teaches kids to do chores for the family good, not for a reward.
  • Separates money and personal achievements, so kids may not expect to be paid for good grades, good behavior, etc.

Cons:

  • If allowance is too generous, older kids may be less motivated to get outside jobs.
  • Can encourage this attitude: “I deserve money simply for being part of this family.”

A Healthy Compromise

Give kids a very modest base allowance and assign mandatory chores. Offer optional jobs kids can choose to do for extra pay. Decrease teens’ allowances as they get older and encourage them to work part-time.

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