Question: Why not tie the allowance to chores? Or does that come later?

Comment: I would advise that you make the allowance a privilege because your son is older. As the oldest child, I often felt gypped when my parents told me I had to wait until I was such-n-such age to get something, and then my sister’s complained that I had it and they didn’t, so they got it without the waiting.

Now, I don’t have kids yet, and I’m sure my sisters would tell you a different story, but I would recommend waiting until your daughter is three, just to be fair.

1. My parents (like many families) had a small entertainment budget. In their accounting, the kids’ allowances would have been the kids’ share of the entertainment budget. They made the family budget more and more explicit the older we got. By the time I was 12, I knew how much my dad earned at his day job, and that he and mom earned more money via the family business, and that he got paid for writing magazine articles. If I wanted to earn more money than my allowance, I could babysit, work for Dad, or do chores that were adult jobs.

2. Most 3 year olds are not in a position where they can walk to the store whenever they like. This means the child must ask a parent to take them to the store. This gives the parent a great deal of control over the child’s spending, even if the child is nominally allowed to choose freely.

My parents always answered no if I wanted to be taken to the store right away. I could always come with on regular trips, or I could make an appointment with them to go on a special trip. The appointment had to be made in advance, and had to be convenient with their schedule. I’m not really sure I figured out what stores were until I was about 5 or 6, and the appointment concept wasn’t really introduced until I was about 8… I may have come up with the idea on my own, from learning about doctor’s appointments, hair appointments and dentist appointments. I remember getting very upset a time or two when mom or dad forgot about an appointment I’d made with them. They used it as a chance to introduce the idea of appointment calendars.

3. If I misplaced my money, or left it out where my siblings could take it, my parents did not replace it. It was my job to keep my money safe, so once I had a bank account I was very likely to put a dollar in the bank… my little brother couldn’t get at my dollars in the bank! He could only get at his *own* dollars there. It was great! (it was less great when I realized that no matter what I wanted to spend my savings on, it would be vetoed… in my dad’s mind that was “T’s college money”. that has set up some really problematic habits for me in my adult life. if you have a college fund for a child who is too young to understand or care, it should not be mixed in with their personal savings.)

4. We had a regular payday. My parents would have a weekly budget for the household, and we would get our allowances on a regular basis just like they did.

5. When I first got my allowance, I was too little to understand how giving money to strangers could help. I *could* understand that giving my sister two blocks from my candy bar, and my brother two blocks and keeping two for myself was nicer than eating the whole thing myself (also, I learned that they could be really awful if they wanted candy and were too little to buy it for themselves… and that I shouldn’t reward them with candy if they were mean to me, because they’d just get meaner). It was a very concrete set of lessons, and giving money to a charity is a lot more abstract. I do think I would have done better with the idea of volunteer work at a young age. It is a lot more concrete.

My two cents: my 5 year old got some b-day money in May. We tried a three pile process, tithe, spend and save. It was complicated and took several tries before he got it.

We went to the bank with the save part and he got to hand it to the teller, but several times he has asked how he gets the money back.

He also wanted to know how God got the money when those men took it. That took some over-simplified explaining as well, and I’m not sure I did a great job at it. He gets the offering part in school, so it wasnt completely foreign.

The spending piece has been interesting. I keep all of our spending money in envelopes so I created one for him. When the book fair came around at school, I was not interested in spending money on that, but told him that he could use his b-day money. He made the selection and was satisfied.

He still has about $10 left to spend and the other day he mentioned something small that I didnt really want to buy, but it was a reasonable purchase so if he asks about it again I’ll make a point to remind him about it the next time we are in a store that would allow him to purchase the item.

Good luck with whatever you decide.

I personally don’t think that kids remember all that much before the age of 5. I would be interested in my kids remembering not being handed money freely, when they had to ask for things. I wouldn’t want them taking it for granted that they just get money out of thin air every week. I also believe in teaching my children to have a strong connection between work and money, so I would probably do some combination of small allowance and extras for special tasks until they were old enough to work.

Asking a child to split up the money is an interesting idea. If the child could really understand the fractions, I think it would be a great way to introduce them to budgeting and various important uses of money other than just to buy material items.

The log book could be simply made of a notebook with columns of the amount, dates of given, spent, and so on.

I love the idea of the allowance into four piles: spend, save, donate, and invest. You might want to pay the young fellow in coins like say quarters so the factions of money may make more sense to the younger mind. My own problem is that the invest part might be better around the age of ten, where the understanding of CD’s would make a little more sense to them.
Until then, a saving account would be fine but in the “log book”, leave that as a blank column, writing in only the age when you will go into more detail at that time. This will give the parents chance and time to slowly teach about a very important area which is skipped over by many families. The areas of investment and keeping a written track of where the money goes.

I fully agree that some chores around the home should just be done but others could be extra reward stuff. (More such to be written up in the log book?) Also the reward/duty jobs changing with their age sounds like a great idea to me too. Maybe each year during the week of their birthday, the family could sit down with the child and discuss what new chores could be added to the different lists of .. reward payment and duty to the home?

Again, a family together, talking over different issues is a valuable teaching/learning experience for all, both the parents and the children. You can not say that all five year olds are not ready for dealing with money as children are all different with different learning speeds. I have seen some kids truly ready to grasp the understanding of money at the age of five.

Take your time and go slowly. Talk and listen to the young person and answers to when handle the different parts of the money topic will be found.

My intention is to do a chore chart and commissions. Not all chores will be paid, but all chores will need to be done in order to get paid for any chores. Also, I think it makes sense at 5 years old to pay for “self-care” chores such brushing his teeth and making his bed. But by the time he’s 7 that would become a non-paid chore.

As for your daughter, I don’t think a child who isn’t even 2 yet has any need for an allowance. I agree that you could wait for her until she turns 3 (if you start your son now). I might start both kids at the same time. I think my daughter will at least get a sticker chart. I probably shouldn’t have started a sticker based chart with my son 2 years ago. The fact that I didn’t isn’t a reason not to do it with DD now! Life isn’t always fair.

huh? my boys are potty trained since they were 2 years and 2 months old!

it should not be about managing money but introducing the concept of money and simple economics to the child. just like you have to explain the concept of ownership, pain, danger, etc. management can come at a later time and surely the child will inquire about it when he/she is ready.

To the commenters arguing that $3 is too much, remember that with this plan only 1/4 of that is in immediately spendable money. That’s 75 cents per week which is not even a full-size candy bar in most stores, not quite a kid-sized ice-cream cone, etc. If anything, it’s almost too small–kids will have to save up for anything other than the quarter machines at the front of the store. If his kid wants to save up for a standard kid toy of $5-$10 that will still take 7+ weeks. That’s some serious long-term planning for little kid.

And on the “chores or no chores” debate, I see it this way. Household tasks and enjoyment are required of all of us without pay other than being part of a team. Some of us pull more weight than others, each to our ability. So too, the proceeds of our family are available to each of us. If giving a small allowance without explicit chores tied to it is welfare then asking our kids to work WITHOUT specific payment is some sort of enslavement. Neither is true.

As it is, I would gladly spend about $1 per week on my daughter if she asked me nicely to buy some special stickers or some crayons or something, and I would not expect anything more of her for that than just her usual decent behavior and general teamwork in the house. Giving her $1 in spending money for herself just puts that responsibility and control on her (and means I wouldn’t have to try to remember if I’d already indulged a request this week!) so she can decide if those stickers today are worth using up her weekly “ask”.

Right now we basically work under a plan where she gets no more than 1-2 “want-sies” each week. If she asks for a lollypop at the grocery store and then realizes she wants a sticker at the store–too bad, so sad, you used up your treat for the week. The allowance will just help us break that down into an easily counted, stored, tangible format. Coupons would work, too, but actual money provides a teaching opportunity. And we’ll probably do the “$X per TIME just for being a part of our family and helping it work smoothly” (just like she already gets certain treats and rewards just as a perk of being in our family) and then a payment process for additonal help with big deal chores outside of her weekly/daily expectations.

However bright he is, the four-pile system is complicated. Maybe you can teach him only ONE concept at a time.

Disclaimer: I never had an allowance as a kid… only got money (pennies!) when I did chores that were outside my daily responsibilities….

I’m conflicted about the whole allowance thing because growing up our allowances were not equitable. My sister and I got a small and intermittent allowance while my two brothers got larger regular allowances. If we asked for our allowance we often got: “what do you need an allowance for” (the lesson being if you don’t have an immediate need to spend the money, you shouldn’t get it). We were expected to do chores around the house regardless. If we did additional chores, we would not get paid extra, but if the boys did the exact same chores were paid. As I was a nerd happy in my plaid shirt and torn jeans reading books from the library, I didn’t need the money but it definitely caused alot of resentment.

And someone else brought up stay at home parents – the working spouse doesn’t tie (well I hope not) the amount of spending money the stay at home spouse gets to how much housework they do, right? It’s just part of the family budget and hopefully both spouses decide on it together because they are a family unit and it is the family’s money.

So I believe that at a certain age – maybe 5 or 6, certainly by the time they are old enough where they might go places sometimes with friends and their parents without you there – kids should get an allowance for “walking around money”. I’m still not sure whether I will require them to do the “save, donate, spend” categories or not. Then if they want something extra, they can do extra chores towards some extra money to save up for what they want.

I’m a same allowance for everybody advocate and I’m quite a bit older than all my younger siblings. In my case, I was followed everywhere I went and I can just imagine the ruckus if I bought something that cost $13 when my brother only earned $8 a week. As stated, I didn’t have an allowance, but I certainly didn’t get 5 more apples at snack time. You’re already taller, stronger, and get to do everything first, and you get paid more? I realize older siblings do more “work”. So what? I’ve only ever been an oldest child, but I think having minions to boss around evens out the extra responsibility.

We started allowance when our children could count to 100 on their own, and identify coins. This was in kindergarten/first grade, about the time they started getting serious “I wants” and peer pressure.

Allowance is not tied to chores. Chores are part of the privilege/responsibility of being part of the family, as is a small allowance. Extra money can be earned for extra chores.

So far we have one spender, one saver (who has enough money for his obect of desire and is trying to decide if he wants a used DS, new DS, or new DSi and is now letting additional interest accrue so he has a cushion left after making his purchase!), and one who is not yet at the age of reason. Interestingly enough, our saver is far more emotionally volatile and impulsive than our spender.

We have family treats, but additional treats, birthday presents, etc come out of their accounts. We have not enforced charitable giving yet, but my oldest has helped me balance the checkbook and seen how much goes to mortgage, the womens’ shelter, savings, etc.

Like sleeping through the night, there are many, many possible solutions. Research, think, and find the best mutual solution for you and your child. Then be prepared to tweak it over the years.