Kids and allowance?

[casjen]

My boys are 7 and 8. They have never gotten allowance before. They have a few chores they do around the house. They clear the table when they eat, put laundry away, clean up toys, organize their backpacks and are in charge of their things (shoes on the shoe rack, jacket on the hook) etc. These are our everyday expectations. I'm not sure I think they should be paid to do them. However, they are huge fans of club penguin and they got their first cards as a gift. They just emptied their piggy banks to buy another card for a month. I don't want to spend $12 a month on cards for them, I want them to start realizing if they really want something they need to save for it. I know if I give them an allowance I am still buying it for them but at least they earned it, kwim?

Do you give your children allowance? How much and what do they do to earn it? How old are your kids?

Also, my ds's b-day is in a few weeks where they will get a card do they'll be good for 2 months until they earn some more.

 

[powelweb]

We give our DD an allowance, but it is not tied to her chores. She's received $1 each week per yr of age since she was 4- she's now 7 getting $7 weekly. We started her allowance so she could get used to handling money and budgeting, so when we would be out at a store and she saw something she liked, she had to think about whether it was worth using her money for it (and not Mom's money).

We also explained that just because she had money didn't mean that we didn't have a say in how she spent it, and gave her the example of using it all to buy candy- just because she could afford didn't mean she could have all the candy she could buy.

She very rarely spends it, and has over $500 in her savings account (we visit the bank when her piggy gets full). She bought herself a magnet and a gift for her friend on our last vacation.

On the chore side, we explained that we all do chores since we all live in the house together, but I expect as she gets bigger we will add a list of extra chores that we'll pay for.

good luck with your boys

 

[Juliegirl1]

My son is 10 and gets $20 a month from me. He also has chores to do when he is at my house and can get money deducted from his allowance if he doesn't do them especially when I have asked him specifically. He can also earn extra money by doing other chores off a chart which he came up with the values for. Very rarely do I have to deduct money. I'm trying to teach him responsibility without tying the allowance to the chores but if I have to do a chore after asking him to do it then he has to "pay" me for doing the chore for him.

 

[drcmk]

We give our DD an allowance, but it is not tied to her chores. She's received $1 each week per yr of age since she was 4- she's now 7 getting $7 weekly. We started her allowance so she could get used to handling money and budgeting, so when we would be out at a store and she saw something she liked, she had to think about whether it was worth using her money for it

This is exactly what we do. My kids are teens now but they've gotten allowance $1 per year since age four. My goal was to teach them about money, not to motivate good behavior, so it isn't tied to behavior or chores. (We have other rewards and punishments for that kind of thing). I like the idea that they can use their money to buy things that I'd never buy for them and can find out for themselves if it was a good use of money or a waste of their money. There are some things that they are not allowed to buy (we forbid R rated movies, for example) even with their own money. They also use their allowance to buy gifts for each other at birthdays, etc and for any special activities like movies or shopping with friends. Also I know that they always have a little bit of pocket money wherever they go and I don't have to keep track of that kind of thing any more.

 

[labdogs42]

For those that give allowance, do you give it in cash? Where do the kids keep it (especially if they are 4 or 5 years old)? Do they take it with them whenever you leave the house? I have wanted to start an allowance for DS (soon to be 6) but I could never figure out the best way to do it. I think I'll start it when he turns six, so this thread will give me some good ideas.

 

[dismom301930]

We do allowance monthly. My girls (ages 10, 9 and 6) get their age each month to spend and their age to save. So my DD10 gets $20 each month, DD9 gets $18 and DD6 gets $12. They also get $5 each month to donate (they usually pick one charity at the end of the year, they don't donate in $5 increments). We don't tie allowance to chores or behavior. Additional jobs above and beyond regular chores can be done for extra money.

We actually keep a virtual bank on the home computer, which they can see at any time. If they need/want money for something, they can have it immediately if they have money in their "spend" account. Any money in their "save" account accumulates interest at the same rate as our money market. "Spend" money earns no interest. They can move money from "spend" to "save" at any time. Any money they receive from additional jobs around the house or from birthdays, etc. can be put into either account.

My oldest DD started investing this year at age 10. She took some of her money from her "save" account and bought a few shares of stock. We explained the risks involved with investing, but she has loved watching her money grow this year.

The virtual bank seems to work well. If my DD is going somewhere and wants to bring spending money, I just deduct it from her spend account and hand her the cash. If we are at a store and one of my girls wants to buy something, I will buy it for them and then we go home and immediately deduct the amount from their spend account. I think they actually spend LESS on impulse purchases with this system since they don't like to see their balances go down. I know as they get older I will probably switch to handing them cash each week, but for now the monthly allowance and virtual bank works well for us.

 

[Kitzka]

DD gets $7 a week. She is 12. As a pp mentioned this is not tied to chores but is tied to money managing. Out of the $28 per month, $5 has to go into the bank. $3 goes to charity and the other $20 can be spentnas she wants but DH and I have the power to veto a purchase. DD usually chooses to save up until she has about $100. Then she will spend some and keep saving.

We also provide her with spending money for occasional trips to the movies but she knows that is also limited to $14 a month (2 trips to the movies or 3 bowling games). We are considering rolling this into her allowance but have concerns about her going out with all of here money (currently will only take a little bit of cash with her).

Lara

 

[richmond282]

We are big Dave Ramsey fans and sort of do what he suggests. Dave calls it "commission". My daughter (age 6) has 4 assigned chores per week that do NOT include cleaning her room or picking up toys. She is expected to do those things no matter what. She gets paid $1 per chore completed (total of $4/week). If she does no work, then she gets no money. The first dollar that she earns is paid in quarters. 2 quarters go in the offering plate at church; 2 quarters go in her piggy bank to save. Any money she earns (per week) after the first dollar is paid in dollar bills and is hers to spend or save up for something she wants. She keeps her money in a piggy bank until she wants to spend it. We feel like this teaches her that work=money and no work= no money. JMO.

 

[JeannieNM]

Our daughter is 15 and has had allowance since she was 4. When she was little I kept a tally sheet because she once gave all her money to an older friend for a cheap 50cent item. I only know this because the other mother was so upset she insisted on her daughter giving the money back to my daughter. I then realized that 4 -6 was to young to handle the actual money or at least mine was. Allowance really cured the "I wants". We were in the Disney store and she was clutching a stuffed animal which she wanted buy. She asked me how much it was and I told with tax she had exactly enough to buy it. She put it right back on the shelf and announced she could not buy it because she would not have any money left. No tears, no fighting. It was a great moment. Before allowance she would have begged me to buy the stuffed animal. She has always pur some in long term savings, some in charity and the rest is hers to spend. Now she is responsible for paying for items purchased at the mall while shopping with friends. When I am with her I usually pay (esp since mother daughter shopping time is rare). She is also responsible for buying her friends birthday and Christmas presents. She has to save for this as the majority of her friend's birthdays are between Sept and Dec. She receives $100 a month. It is direct deposited from our checking account to hers and she has a teen ATM card. It has worked out well. Today after Driver's Ed she and her friend are going to the mall. She did not ask for money or anything just said I have my card as she headed out the door. Her allowance it not tied to chores; the purpose of her allowance is to learn to manage money, savings, charity and to learn to make choices. So far it has worked wonderfully. She is vary savvy shopper, is generous with her charitable donations, and always has a cushion in savings.

 

[labdogs42]

We do allowance monthly. My girls (ages 10, 9 and 6) get their age each month to spend and their age to save. So my DD10 gets $20 each month, DD9 gets $18 and DD6 gets $12. They also get $5 each month to donate (they usually pick one charity at the end of the year, they don't donate in $5 increments). We don't tie allowance to chores or behavior. Additional jobs above and beyond regular chores can be done for extra money.

We actually keep a virtual bank on the home computer, which they can see at any time. If they need/want money for something, they can have it immediately if they have money in their "spend" account. Any money in their "save" account accumulates interest at the same rate as our money market. "Spend" money earns no interest. They can move money from "spend" to "save" at any time. Any money they receive from additional jobs around the house or from birthdays, etc. can be put into either account.

My oldest DD started investing this year at age 10. She took some of her money from her "save" account and bought a few shares of stock. We explained the risks involved with investing, but she has loved watching her money grow this year.

The virtual bank seems to work well. If my DD is going somewhere and wants to bring spending money, I just deduct it from her spend account and hand her the cash. If we are at a store and one of my girls wants to buy something, I will buy it for them and then we go home and immediately deduct the amount from their spend account. I think they actually spend LESS on impulse purchases with this system since they don't like to see their balances go down. I know as they get older I will probably switch to handing them cash each week, but for now the monthly allowance and virtual bank works well for us.

Do you use a special program for this or an excel spreadsheet or something like that? I think this idea is great! I'm always afraid DS will lose the cash and totally defeat the purpose of giving him money!

 

[tink_lover]

We are big Dave Ramsey fans and sort of do what he suggests. Dave calls it "commission". My daughter (age 6) has 4 assigned chores per week that do NOT include cleaning her room or picking up toys. She is expected to do those things no matter what. She gets paid $1 per chore completed (total of $4/week). If she does no work, then she gets no money. The first dollar that she earns is paid in quarters. 2 quarters go in the offering plate at church; 2 quarters go in her piggy bank to save. Any money she earns (per week) after the first dollar is paid in dollar bills and is hers to spend or save up for something she wants. She keeps her money in a piggy bank until she wants to spend it. We feel like this teaches her that work=money and no work= no money. JMO.

This! We learned about this during our Financial Peace University class and loved the concept. We both had a problem with just handing over money - the commission idea reinforces that if you work, you get paid. We have three envelopes that are used - one for save, one for spend and one for give. It has worked out great. The lady in front of us when checking out at Target was so impressed that ds9 used his own money to purchase Christmas gifts for his siblings. It is really teaching children all about what money means and does.

 

[MiniGirl]

This! We learned about this during our Financial Peace University class and loved the concept. We both had a problem with just handing over money - the commission idea reinforces that if you work, you get paid. We have three envelopes that are used - one for save, one for spend and one for give. It has worked out great. The lady in front of us when checking out at Target was so impressed that ds9 used his own money to purchase Christmas gifts for his siblings. It is really teaching children all about what money means and does.

I like Dave Ramsey, but do not follow his suggestion here. Main reason is that when my girls get older and possibly have a part time job I will still want them to do chores around the house. They will no longer need an allowance, but I will still want them to contribute to the household chores. Also, as a SAHM, I do not "get paid," but I still have a number of things that must get done -- just as we all do.

We are in the dollar per year per week camp. From there, a percentage is expected to go to charity, another portion in long term savings, some in short term savings, and the rest they can spend on pretty much what they want. Dh and I di have veto power over their purchases though.

 

[drcmk]

For those that give allowance, do you give it in cash? Where do the kids keep it (especially if they are 4 or 5 years old)?

Yes, we give them cash. When they were younger it was a good way to teach them to make change if I gave one a $20 and her allowance was only $6. My kids have wallets that they keep in a special place. If they money gets above a certain amount, we deposit it in the bank. When they were younger we would count the money and review it with them regularly. We don't need to do that now. I expect my kids to keep some money in their pockets whenever they leave the house--just in case---but they are teens now that that has only been the past few years. Most of the time, if they want to buy something while we are out or on vacation or something, I "front" the money and they pay me back when we get home. We do an awful lot of our shopping online so they are used to me making a credit card purchase for the kids that they reimburse us for.

 

[drcmk]

If she does no work, then she gets no money. . . . We feel like this teaches her that work=money and no work= no money. JMO.

I get that. I understand why you would do that. I'm not sure I want to completely tie work with money, though. There are lots of things that all of us do that we don't get paid for--the kids and I do volunteer work. My kids know that I get paid for doing my job (and I need to get paid so we can live) but they also know that I do my job because I think it is really important work and it makes me feel happy or at least accomplished when I do it well. My biggest wish is that my children find occupations that give them joy in addition to paying the bills.

 

[shortbun]

Allowance was not tied to chores in our house-except if you didn't do your chores, you didn't get your allowance.....wait a minute, lol! My son does his chores and does extra house work for the money he needs. For instance, because there is a thaw coming, I needed the patio and the pad at the back of the house cleared of snow and ice. Ds and his best friend spent about two hours clearing them-chopping ice, shovelling and snow blowing. I paid them each $10.

 

[tink_lover]

I like Dave Ramsey, but do not follow his suggestion here. Main reason is that when my girls get older and possibly have a part time job I will still want them to do chores around the house. They will no longer need an allowance, but I will still want them to contribute to the household chores. Also, as a SAHM, I do not "get paid," but I still have a number of things that must get done -- just as we all do.

We are in the dollar per year per week camp. From there, a percentage is expected to go to charity, another portion in long term savings, some in short term savings, and the rest they can spend on pretty much what they want. Dh and I di have veto power over their purchases though.

Well, we believe in the concept of work=money. I agree with others that it is important to find meaningful work. And we also do volunteer work as a family. But in order for a household to work (and someone to be a SAHM or SAHD), someone has to be bringing money into the household in order for it to function and survive and pay necessary bills. I certainly think that what a SAHM or SAHD does is extremely important. The DR system is simply trying to show kids at an early age, how to budget. DH and I do not veto anything they want to purchase with their spend money. Again, trying to let them learn (and teach them) life lessons on handling money.

 

[GAGirlInVA]

We do a dollar per year every two weeks when they turn 5. (Daddy gets paid then too.) They learn about tithing, saving and spending.

They have a certain amount of chores that are because they contribute to our household. Money is not connected to that.

We have special chores that they can earn "commission" on. They are on an as needed basis.

That is our twist on Dave Ramsey's suggestion.

 

[Fyrefly]

I was given $2 a week starting when I was about five, but that was back in 93 when that meant more. When I was eight or nineish I wanted a little more and my dad agreed that was fair so I got $5 a week. Sometime late middle school it went up to $10 a week. I never had a job, I was in 5 activities at school and top ranked the class so my parents said school was my full time job. College internships were the first money I earned myself and that's when my family's support for "extras" for me stopped.

I always got mine in cash, and kept it in a bank shaped like a big Crayola crayon. I had a savings account the same week I was born, and christening money, shower cash gifts and stuff, were all put into there for me. I also was pretty frugal as a kid, probably emulating my parents. I saved a lot of it. When it got to be a decent amount in my little bank, we'd go to the real bank and deposit it. I like having a nice sized savings account now, its a secure feeling. I'll probably put it towards a car or a down payment on a house someday, and when I moved and had to go two months in grad school without pay before my payroll was all set out, it was great to have all that money sitting there instead of being nervous and counting the days till payday like others.

I think in some ways its nice to give your kids a smaller allowance because it teaches them to save, but it also depends on what you expect your kids to pay for by themselves vs. what mom and dad pay for. I think the more you expect them to pay, the larger the allowance should be.

At this age it's important that they get that allowance is not a magic black hole of money that should be depleted as often as possible, but its even better if they save on their own rather than being prompted. The rules PP mentioned are good. If they see you practicing good spending habits and talking about savings and how CC's are paid off and stuff, they'll absorb it. Way easier to brainwash them now then undo bad habits later!

 

[carebee21]

For those that don't tie allowance to chores or behavior, do you plan to do so in the future? We're toying with the idea of an allowance, as DS (7) is really starting to get intersted in money and how much things cost, as well as getting a case of the "buy me this, buy me that" lately. However, although I agree that it's important to teach money management and savings, I also don't want to set a precedent that you just get money for nothing and think he's entitled to it into his teenage years, kwim?

 

[MiniGirl]

Well, we believe in the concept of work=money. I agree with others that it is important to find meaningful work. And we also do volunteer work as a family. But in order for a household to work (and someone to be a SAHM or SAHD), someone has to be bringing money into the household in order for it to function and survive and pay necessary bills. I certainly think that what a SAHM or SAHD does is extremely important. The DR system is simply trying to show kids at an early age, how to budget. DH and I do not veto anything they want to purchase with their spend money. Again, trying to let them learn (and teach them) life lessons on handling money.

Like I said, I like Dave Ramsey, and agree with him on many things. This is just one area that I don't. Also, I don't want this to become a SAHM(D) vs working parent debate. We all, regardless of that working status, do things for which we don't get paid. For us, chores are something we do because we are part of a family, and it is a contribution to that family unit that keeps things running smoothly. Allowance is used to teach money management. When I say we have veto power, what I mean is that we will not allow our young dds to spend their money on things we would not approve of -- some CDs with mature lyrics, for example. Now, if my dd wants to blow all her money on Foo Dollars (online gaming currancy), I will allow that. I, personally, think it is a waste and not what I would chose for her, but it is not offensive. KWIM?

All I'm trying to say is that not all work results in getting money. Sometimes the payment for work is the satisfaction of knowing you helped out someone you love or helped someone in need (like the volunteer work). Really. I don't think we are that far off in what we believe.