Moving Forward: Teens and Parents
What’s in an allowance?
Little more stirs the pot of disharmony than money. Because we place such value on it, everyone has differing ideas about what to do with it and nobody, even those with lots of it, can seem to get enough of it. Merely mentioning it often triggers impassioned debate.
As a parent, you need to teach your kids about the ways of the world. That, sadly or otherwise, includes a working knowledge of money. But how do you do that?
While an allowance might be one way to go, if you don’t talk about how and why you’re giving your child money, you run the risk of confusing your child and creating frustration for yourselves as a couple.
A good conversation about your money philosophies will go a long way toward keeping you and your kids headed down the same path toward financial responsibility. And consider that an allowance is a sound way to help kids distinguish between needs and wants, priorities and saving.
You might also consider the following:
- Be united. You both should agree on whether or not you intend to give allowances up front. This doesn’t mean you can’t change your minds, but it’s often counterproductive if both parents are doing different things.
- When is a good time to start? When you think your kids can handle money responsibly…with your guidance, of course. Most kids are old enough by age six or seven to understand the value of money and the concepts of spending and saving.
- Is allowance payment for chores? Chores can help develop family responsibility, and allowances help teach money management. But, do you want to “pay” your child for doing chores or helping out? It’s best to decide upfront what your basis of payment should be. You don’t want to hand out money for nothing, but your child isn’t your employee either. Consider different things that allow your child to earn his or her money, such as good behavior or help with special tasks.
- How much should an allowance be? Consider what you can afford, the age of your children and their maturity. One dollar a week for each year of age is a good rule of thumb.
- Saving versus spending. You’ll want to encourage the benefits of saving, but spending is also part of the lesson of money management. Even foolish spending teaches a lesson. Don’t allow anything illegal, immoral or harmful, but allow your kids to learn from their own mistakes. Don’t prevent them from buying something because you feel it’s impractical.
- Be consistent. The best way for kids to learn about money is to have a consistent source of income. If you decide to go the way of allowances, you should try to stick to that decision.
If giving an allowance is right for your family, the administering of the allowance is important to the success of the program. Everyone should know the amount, the payday and any conditions tied to the allowance, then follow through on them.
This article is provided for general, informational purposes only and is not intended as advice specific to your situation.
