A couple of years ago, I did a google search for tips on how and when to give our children an allowance. During my search, I came across several posts from parents who believed kids should not receive a cash allowance. Having grown up with an allowance, this opinion was surprising.
One reason parents argued against allowance was valid. I agreed with the fact that children are a part of a family and should be expected to help around the home without expecting payment. Although I very much agree, there are many benefits to receiving an allowance.
Learn to Manage Money
We want our kids to learn to manage money while they are young. Our kids will not learn from anyone else in life how to manage money. Schools do not teach money management. Our government certainly does not teach money management. If parents do not teach children money management, they will likely never learn it.
When making purchases with their allowance, we do not supplement. If there is something our kids want for $15 but they only have $10, we do not throw in the extra $5. Supplementing their allowance does not help them learn the value of money or how to save their money. Understanding the value of money at a young age and spending only what you have is valuable.
Tired of Saying No
I was honestly tired of saying no. Once our daughter was in school, there were optional purchases every month placed in her hands. Schools sent home flyers to buy books, book fairs occurred and more. Having our own budget to adhere to, I was constantly telling her no. While I do not think it is wrong to tell a child no, giving my daughter an allowance allowed me to change my verbiage. If I did not feel like an optional purchase was something I wanted to spend money on or could spend money on, I could simply let her make the choice to spend her own allowance if she had the funds.
Learn to Work for Money
Part of having an allowance is earning it. My husband and I do not have significant wealth to pass on to our children, therefore we know they will have to work for a living like most adults in our society. We want them to understand this at an early age. Our children have chores they are expected to do on a daily basis unrelated to their allowance. These chores include making their bed, putting away their clothes, backpacks, shoes and more. To earn their allowance, they have another list of chores that are weekly to help out around the house. If they refuse or give attitude about doing their chores, they risk losing their allowance for a week. We would rather our kids learn the lesson of losing a $5 allowance instead of a job as an adult when they have bills to pay.
Looking for other budget tips? Check out this post here.