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Jackson will be five this winter, and I still haven’t started an allowance for him. I almost started a year ago, but I never did.
You see, I need a system that will work for me. So that is where you come in!
How do (did) you handle allowance with your kids?
I am thinking matching dollars to age – i.e. 4 years old, 4 dollars. So should that be weekly so he can save a substantial amount of money for toys he wants to buy?
How do I handle tithing and savings? (I think I will have him save for college since I am doing the same for him with an RESP.) Do I open a savings account at a bank for him?!? Or should I use separate wallets right now and keep it at home as we get used to the whole thing?
And does he work out the tithing (10%) and the savings (I am thinking 20%) each time he gets his four dollars? That means I need to have a lot of change handy!
As you can see, I have a lot of questions. Growing up, my parents were as disorganized as I am about the whole matter and never settled on a system that worked well for us all. So it always changed and we never formed a habit that stayed with us through the years.
But I am committed to helping Jackson form healthy financial habits. (That will be another post about my hubby and I forming healthy habits – we still don’t follow a budget! And I know that not only do we need better financial habits for our well being, but we must model them for our son.)
So what do you think? I have read great tips about allowances and savings in different Works for me Wednesdays, but I didn’t keep track of them and now they are all blurred together in my mind.
Janice says
WOW! You guys are awesome! Thanks for the great advice. I will discuss it all with my hubby and when we decide on our system I will let you all know. THANKS!!! 🙂
Kailani says
My daughter is now 4 and I’ve been considering giving her an allowance. Thanks for asking this question. The comment you recieved were very helpful!
Holly Schwendiman says
I think kids need practical experience to really learn things. I find that including my daughter in spending discussions and moments in the store or register are very helpful as well as helping her manage her own money. Just this week she’s been trying to decide what to spend her birthday money on and for the first time she’s becoming aware of price tags. This is a very good thing for mom!
Hugs,
Holly
Holly’s Corner
Here via the Carnival of Family Fun ;o)
Ruth says
We started giving our kids allowances around age 5, but they didn’t understand the concept so we stopped. We had tried again a few years later, but hubby lost his job. Now he is back at work and our oldest is 11. Our son has shown that he is responsible with the money that he does get and is very helpful around the house and with his younger siblings. He is active at our church with Sunday school and sound booth work and in the community with volunteering. We felt that he was ready now, and are giving him $5 a week. He has to take out his tithe and he has chosen to save the rest. He has a goal of a drumset in sight!! Our other 3 kids, we will wait until they are showing the same amount of responsibility before they receive any allowance. It is something for the others to strive for as well.
Sarah says
We started our son on http://www.daveramsey.com Financial Peace JR. when he was 4 and we have been so blessed by it. We have him tithe a straight dollar because it is easier to do and is it really bad for them to give 20%, we don’t think so. Here is a cool story I posted on my blog awhile back; http://momteacherfriend.blogspot.com/2006/02/robot-money.html
mumsgather says
This is really an interesting topic. I haven’t really thought of an allowance yet since the kids are just 2 and 4 but we have started saving for their college education. We couldn’t decide whether to open a bank account under their names or ours. Eventually we opened a joint account under my spouse and my name and save a fixed monthly amount for them. We will convert it to their own names once they are old and responsible enough not to misuse the money we have saved for their education. 😉
Faerylandmom says
Wow! That’s alot of experience speaking! I think everyone’s pretty much right though…you have to figure out what will work for your family. Also, I think the key thing is what Spunky said about doing a study. Why didn’t I think of that? LOL!
Erna says
I have to come back and read through these comments. I don’t think I’ll be tying allowances to chores here b/c I just feel it is something we do as a family. However, I’d like to teach Rachel more about money as she gets older and have a regular amount she can have but I’m not sure how I’ll work it all out. Right now, most of her money that she gets (from grandparents or our loose change) goes into her piggy bank. It is found here and I love it:
http://www.msgen.com/prod/assembled/money_savvy_pig.
html
We have one for each of our girls. It got a parent’s choice award. I only wish the holes at the bottom of the piggy bank were bigger on the size we have. They even have systems for teens. For now, we let our oldest choose where she wants to put it and she distributes it all over. We talk about the categories (Save, Spend, Donate, and Invest). Someday we’ll open a bank account for her to hold her money and to teach her more about banking when she gets older.
Ramblin Rose says
I dont believe in allowances for jobs around the house as each of us are a team member and in order for our house to run smoothly we need each member (even my two year old) to help with small things. That said if my kids want money for something they’ll ask for a job such as watering the garden etc. they have a job list which helps tremendously and complete all the tasks on it everyday and if they dont they have consequences such as no tv , no sleep overs etc.. we generally dont have to much of a problem. I do have a friend who pays her kids for jobs and she also takes money away for fighting, talking back to parents, disrespect, not completing jobs etc..Which sounds like a terrific idea it works for her..
RR
Mike says
Very educational. I’m not yet giving allowances to my 3-year old. But I will keep the advice given in the comments when I do.
Mike
http://somethingaboutparenting.typepad.com/
Kathleen Marie says
My kids always had to earn it. I never just gave it to him. Have him do some age appropriate chores. I also had them give 10% (tithe/offering), Save 10% or more and the rest was spending money. I never loaned in advance.
Spunky says
I would encourage you to do a word study from the bible on the words “work” and “money”. Look into Proverbs for how the wise and the foolish handle money. That is the best starting point to address the questions you are asking.
The best foundation you can give your son is a biblical foundation and understanding of money from God’s Word. That requires you to study and understand what it says. After you have studied the scriptures then go to a few other trusted resources on money management. Because you already know what God’s word says you will be more able to then sift out the “hype” from the “help.” And you will be able to confidently transfer your knowlege to your son.
Allowances is one of those areas that can be a great help to parents and children, or cause a lot of confusion. It needen’t be. As you go to God’s Word His truth will be revealed and you will know better how to apply it to your lives.
Stacey says
WOW! Look at those responses. 😀 For me I didn’t want them to not earn the money, but I also didn’t want them to get paid for EVERYTHING that they did. So, they have chores that are theirs because they are part of the family. Then I have a list of MY chores on the fridge. If they do some of my chores, then they get paid according to their heart attitude and how good of a job they do. I do not actually give them cash though. On a wipe board they have a “bank” where we keep track of how much they earn (adding to it every saturday), and we subract the tithing out each time as well. Then when they are ready to pay it we will give them the cash, or they buy something (we pay for it) and then subtract it from their “bank.” Does that make sense?? 😀 I am SURE you will figure out what works best for Y”ALL.
MICHAEL MANNING says
HI! I’m still dating, so I’m not an authority. BUT…my allowance started at 25 cents then went to 50 cents and ultimately $3 a week. My Dad tied it in with mowing the lawn etc. Today, with kids driving BMW’s, I just throw my hands up and tune into “Leave It To Beaver” re-runs for “Ward Cleaver’s” sage advice! lol!
Lyric says
I raised three kids and with each one the “system” was adjusted… 🙂 The principle, however, never changed. You get access to the family funds by behaving like a member of the family – this included chores, relationships, attitudes, et al. I never “rewarded” them for doing the basics but there was ample compensation for being an active positive participant in building and supporting the family.
KellyC says
These are great responses! We don’t pay our kids much in allowance – only $3 at this point, and they are expected to contribute with certain chores and general help around the house. They also earn money by assembling games for our company, and we pay extra for big seasonal jobs (most recently raking leaves!!) The extra pay more than doubles their allowance.
With their own money, they’re expected to have minimum goals for saving and giving, and maximums for spending on candy. The “saving” goes into their own savings accounts. It’s a big deal for them to put their own money in their own accounts and watch it grow. Currently, Curt is saving for a 4-wheeler. Deena’s goals are smaller (rollerblades or karaoke machine) and she’s waiting until after Christmas to decide whether to purchase;)
We think it’s important for kids to have their own money to manage. We rarely buy them toys or candy now (at ages 7 and 9). And we find that they always share the candy they buy (just like we do for them.) It’s one way they are able to be generous.
Excellent discussion.
Carey says
As for bank accounts, i opened one up for my kids right around their first birthday. Some family members gave the kids money as gifts, and that money was put right into their accounts. They get so much stuff from everyone else, that they dont need to spend it, and they know they are saving for college, so they can have a bright future.
Carey says
In my opinion, kids are part of the family, and they need to help in order for the hosuehold to run smoothly. I dont think kids should be paid for things they have to do already. Kids should get allowance for the things that are done above what they normally do, and if you can afford it. We never had allowance growing up, and my kids do not recieve allowance. They do get money from time to time. and they do have to save it and tithe it. When the kids have enough money saved for the thing they wanted, they need to evaluate if its really a neccesity, or something they are going to buy and play with for an hour and then be forgotten. We rarely buy extra toys or other stuff..money is very tight in out house, and i dont think my kids are suffering from no allowance. My oldest is 11 1/2, and she has never asked for one.
Rona says
Our son’s allowance was never tied to chores. He gets 1/2 in cash and the other goes into his savings account.
Dee says
I may be the odd man out here, but we chose not to start our childrens’ allowances until they turn 10 years old. Then they receive that (the amount of their age) amount 1 time a month. Yes, I know, that’s cheap! However, they have everything in the world and are well provided for. I have an 11 (almost 12) year old DD and a 5 year old DS and there are no compaints in the household.
When I give my DD her allowance, it is broken down so that she can save and tithe off of it. She has learned to be a very good manager of her money. Now, when she receives money for gifts, that is hers. I put no restrictions on it (savings/tithe). She also asks from time to time to work (either for my DH and I) or for her grandparents in order to save for something. Which to me is FINE!! That means she is learning the value of a dollar!
We of course, provide her clothes, necessities and a few indulgences from time to time. But we expect her to save to buy things too! I think at the current time she has over $200 that she has saved. So we can’t be doing it all wrong!! 🙂
Good Luck!!!
Laurie says
We could never really afford to just give an allowance to our children when they were younger. When my oldest was 4 he begged for a Nintendo. We told him that if he would vacuum the living room 4 times a week we would give him a dollar per week. That was the beginning. He saved and saved and by adding in gift money from birthdays and holidays was able to buy it in one year.
We would pay for special jobs done. Our children would ask relatives and neighbors for jobs also.
We also had them take out 10% for tithe and 10% for college. Over the years this has added up to a significant amount for college. And I love the fact that they naturally slid into 10% or more for tithing when they began to make much larger weekly paychecks…they never questioned it.
I never made them tithe or save for college off of gift money. That didn’t seem right. If they were handed a shirt or toy for a gift I wouldn’t find out the price and make them tithe and save from that amount.
All of our children (ages 9-22) are frugal and yet generous with their money. We are really proud of them in this area.
Angel Cope says
Check out Dave Ramsey’s ideas for Kids He has great ideas about the difference between a commission and an allowance. Using an evelope system. One for tithe, one for saving, and one for spending. I know yours is five so he may or may not be ready for that. With My five year old we are doing a comissions jar. Each task is given a dime, quarter, or dollar amount. As soon as she does that task she is given her “comission” It is the instant reward, and she can see it adding in her CLEAR comission jar.
Of course there are only a few task she can earn money for. Keep it Simple. Because, in my opinion, there needs to be a balance in teaching them about money, and reward, and teaching them that they have to contribute as an active member of the family, because they are a member of the family, and no other reason.
Kathy Pitt says
Hey Janice. My kids get $5 each a Fortnight. BUT they have to do their chores (like 2 jobs a day, like putting dishes away, or taking rubbish out) for it. 50c goes to tithing, $2 to spend and $2.50 in the bank, or $4.50 in the bank. I know it isnt much, they are 10 and 9, and 6 … but to me, at this age, what could they be needing their money for really? Not like they go out shopping, or to the movies alone, or to the arcade ect!! If they were going to the movies, i sure wouldnt ask them to pay for it out of their money 🙁 Their money in the bank, is saving for their mission which will now be set up thru school banking, much easier than us taking it to the bank.
We have only really had pocket money for a fwe years. They want at times a new sony game, so i teach them the value of saving for something you want this way.
I give my kids theirs in change, so it is easy for them to sort out.
good Luck 😀
turtle-hope says
My kids are 8 and 10 and do get an allowance. The general “rule” or guidelines is $1 per age per week. However, I feel that is a little too much for the ages of my kids. Right now I give them 50 cents for each year. So my 10 year old gets $5 per week and my 8 year old gets $4 per week. When they reach teenage years, I’m planning on uping it to $1 a week. $20 a month doesn’t seem like much for a teenager. A CD can cost that much and movies…Wow! Anyways, I started my daughter on her allowance when she was 5, but she didn’t seem to understand the “value” of money. By this I mean, she would leave it laying around, didn’t put it in her piggy bank and would often not know what happened to it. So I stopped her allowance until she was about 6 when she understand what to do with it and why. My son seemed to get the idea right away and so we started him off at 5. However, we started him small like 50 cents a week, to make sure he understood and didn’t lose it. He really liked the idea of having some coins to put in his bank. It takes them a while to figure out how much a penny is compared to dimes, nickels and quarters. The bigger the coin, the more it must be right? They started off collecting their allowance in jars. When I felt they had enough to open a bank account and understood about savings, I opened an account for them at the local credit union. They love keeping tracking off the amount of money they are saving. I help them with this by putting the info in quicken. As to tithing and saving, I’m afraid to admit, this kinda fell to the wayside. It was hard trying to tithe $2 or $3 a week. We have been explaining the importance of tithing 10% and saving, but we haven’t had them put it into practice yet. I tried when my daughter was about 6, but she didn’t really understand the concept. Now she does and asks us about tithing. We have been encouraging her to do so. For the most part, the kids like to put their allowance and their birthday cash from their grandmas in the bank. They really spend very little of it. Now that my daughter is approaching the preteen years, she is more interested in spending her money on gadgets. We have been working with her on tithing 10% and putting most of the rest of it in the bank.
I try very hard not to link an allowance to chores in the house. I want them to understand that as members of the family, we all have responsibilities to/for the family and this includes chores. We help each other and help should not be dependent on whether you get paid or not. I guess you could say an allowance is like a “cost of living” amount, in the losest sense.
That is how we deal with allowance in our house. You will have to decide what works best for you and your family. Some questions you might want to ask yourself is: Is Jackson old enough to understand about what money is for, why we use it and be able to keep track of it (i.e. not leaving it wherever). How much do you want to start him out with, how often are you going to give him an allowance and why are you giving him an allowance. Your answers will help you decide the best course for Jackson and what makes things easiest for you. Having people share what they do is a great way to start. I started to give my children a weekly allowance, but I was always forgetting and sometimes I just didn’t have the change or cash on me. Now I give it to them once a month. It’s really easy to just transfer some cash over from my account to their account. It’s also easier to tithe a months worth of allowance than once a week. Putting it into a bank right away also helps teach them the importance of saving first. Financial experts always tell people to pay yourself first. Not that we are the best at that, but at least my children will have that idea from the beginning. They already do that. Hope this helps! Please let us know what you decide. New ideas are always worth exploring.
Cheri says
Janice,
I posted on this Friday as part of Frugal Fridays. Check it out at my blog.
For my son, we do $1 for each year, tied to chores, adding on chores each year as well. He has a weekly list to check off – no work, no money. 10% to giving (his choice of receiver), 40% to savings, 50% to him for spending. He has a local savings account we just set up – I plan to take him once a month to deposit his savings.
His regular chores (at 9 years old) include:
Clear own dishes after all meals and snacks
Set dinner table
Clear dinner table
Turn night light and radio on and off
Put dirty clothes in basket, put away “clean clothes”
Pick up all toys, etc laying around outside bedroom every night
Put shoes in basket or on shelf and hang jacket
Put bike and outside toys away every night
Empty garbage cans as needed
Make bed every morning
Put sheets in wash (one specific day a week)
Wipe his bathroom down once a week
Put his towels, etc in laundry (one specific day a week)
Vacuum room once a week
Most of this is what I call “self care”, but I’ve noticed that a lot of children his age and older aren’t even responsible for that much at home.
My brother’s family posts a list of chores for each of his children and they get paid by the number of chores they do each week.
Hope this helps a little.
Ruth says
i remember getting an allowance of 5 cents a week!!!
of course…
that was a very very
very very very
very
looooooooong time ago.
but it is a happy memory.
Sarah S. says
My kids are older and do have a bank SAVINGS account — our bank encourages the kids and they get “treats” (pencils, mugs, key chains) when they make a deposit. We have had the Crown Bank — it didn’t work well for our family, but it is a fabulous idea. http://www.daveramsey.com has a “Financial Peace Junior” kit that has 3 envelopes “Give”, “Spend”, and “Save”. These are what we are currently using.
My kids get $5/ week, it IS tied to jobs (I know this is a controversial subject), and they “tithe” $1 (is it still tithing if it’s 20% instead of 10?:-) and save $1 and have $3 to spend. I really think that would be okay for a 5 year old to only have $2 or $3 to spend — that’s enough that they can actually make a decent purchase of something they may actually want, blow it on candy or soda, or save up for a few weeks for a bigger item.
As I read over what I have written and what Faerylandmom has written, you obviously will get opinions across the map and have to decide (and try it and figure out) what works best for your child and your family. We’re on our third different “plan” at our house over the course of about 7 years — obviously I’m willing to admit when something isn’t working and try again! More than anything I think it’s important to let kids get their hands on money and start making (guided) decisions about it and understand the value of it.
God’s blessings and guidance!
Faerylandmom says
My kids aren’t old enough for allowance just yet, but when I think about starting, I have something in mind already. There is a piggy bank you can get from Crown Financial Ministries (www.crown.org) that has three compartments: A church, a store, and a bank. They advise that you teach your kids that some of their money has to go into each bank every time, but at this young age, you let them decide how much. This gives them a visual picture, as well as a hands-on opportunity to learn. Not to mention counting.
Then, as they get older and learn more about what the Bible says about giving, keep it open-ended. They advise that you talk to them about what the Bible says, then ask them what they think they should do. Most of the time, the kids will do the right thing. I wouldn’t worry about getting too complicated with a four year-old. You don’t have to be that organized. :o)
I also wouldn’t worry about opening a bank account unti they’re old enough to help with the math.
Also, I know that Crown isn’t the only place you can get a bank like that. Most Christian bookstores should have one, or you can make one. Either way, I think it’s a genius idea! Check out their website.
I think $4 might be a bit much…he wouldn’t have to save very long. I might start out with something small, like $1 a week and see how that goes. I think that would give you leeway to pay him extra for special things, like chores that aren’t part of a normal day, or something like that. I also recommend going to http://www.focusonyourchild.com (or .org can’t remember which). It’s a parenting forum, and I guarantee you’ll find this issue talked of there.
God bless, and I hope this helped!