Kids Allowance... How much? For what?

Money-management is one of the most important lessons we can teach our kids. They will deal with money their entire life and the earlier we teach them the importance of it, the better! An allowance is a fantastic teacher. Kids learn they can spend it each week, get something small or save it for something bigger. You can sprinkle-in some of your family values while you're at it, like give part of it to charity or save/invest part of it.

What age should kids get an allowance?

Most people start giving their kids an allowance around 8 years old, but every family does it differently. My husband and I, for example, started giving an allowance when our kids were 7 & 5. Basically, when they understood what a toonie could buy, we started trading them for chores! hehe...

How much?

I did a bit of research and came across an interesting stat from a US survey (sorry, I couldn't find a Canadian stat). 66% of Americans kids get an allowance. Guess what the average allowance per week was. $30!!! Thirty frickin US dollars! Am I the only one that thinks that's insanely high?

The more reasonable amount I found was $1 for each year of age, meaning if your child is 8 years old, they could get $8/week. I think that's very reasonable, definitely more reasonable than $30! Eeek! Again, it's completely based on the family budget. If it's a financial struggle to give them an allowance, get creative. Instead of an allowance, there are plenty of games that could teach them about money. Or you can give them an allowance with play-money they can trade for treats. It could be a game.

Chores.... Yay or Nay?

Here are 3 ways you could tackle an allowance. Again, there's no "right way" to do it. Do what works for your family!

1) Giving $ per chore

2) Giving $ at the end of the week, after the kids have successfully completed a list of chores

3) Giving $ no matter what

I was curious what other people did, so I did a poll on my social media. I found that 28% gave an allowance per chore, 65% gave an allowance after a "week of duties" and 7% gave an allowance no matter what.

Now, some people might scoff at the idea of giving an allowance no matter what, but I encourage you to consider it. As a mom commented: "I actually just give my kid an allowance no matter what. I don’t pay him for chores because I don’t get paid for them. Everyone is expected to do their chores, no matter what. I don’t want to set up a system where they can skip chores and not get paid .

The lesson in money management at this age is about learning to manage it - save up for something you want, or waste it. He’s only 10 now but I think I would be ok with paying a few bucks for extra things eventually, like raking or babysitting" .

Great points.

We decided to give the kids money "per chore"

I'm not encouraging one method over the other, but this was our experience. We tried the allowance "after a week of duties". What I found frustrating was deciding what to do if the kids did their chores 80% of time. Do they get 80% of the allowance? (eye roll) Too complicated. Then, we tried giving them money per chore. You know what I loved about this? The kids actually fight over who "gets to do" the dishwasher! Literally! Yes, I want the kids to learn we all have responsibilities in our family.... but, I'm a much happier mom when I don't have to ask 10 times, get frustrated, probably yell and end doing up doing the darn dishwasher myself.

Cash vs. Debit

It would be silly not to consider teaching our kids how to use a debit card and online banking, especially after Covid made us so afraid of cash, but I think for small kids, my vote is still with cash. They can hold it, count it and give it. Once kids are older and responsible enough to own a debit card, most banks offer a free youth savings account that parents can access.

"I Don't Know How to Teach About Money"

You're not the only one! There was almost 3 billion results when I googled "how to teach kids about money". It's a popular search and there's tons of resources... and hey, maybe you might learn a few things, too! Learning alongside your child is a great activity for the both of you!

Well, I hope those were useful tips!

Natalie xo