Allowance For Kids – What Do You Think?
Some good ways to teach kids about money with an allowance…Allowance for Kids – Let Us Know How You Feel
Parents are split down the middle of whether an allowance for kids is beneficial or if it lends to the sense of entitlement so prominent in today’s society. My spouse and I struggled with the same issue while we weighed out the pros and cons of an allowance for kids.
This article will address the pros of allowance giving and a later article will discuss the cons.
It is important for children to learn to value and use money responsibly. For the best possible outcome later, it is best to start this teaching as early as possible. If children grow up with good money management skills, they will never know any other way and are conditioned by habit to have good money morality.
The majority of money mismanagement stems from lack of education. People don’t know what they don’t know. Because we are creatures of habit, we will continue to do something the same way, even if it produces undesirable results because we do not know any different.
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You can consider an allowance for kids around the age of 5. Consider this the pre-allowance stage. Begin by rewarding your child for picking up their toys every evening before bed. Make sure you really pile on the praise and even add in a fist bump or high five. In the pre-allowance stage, your child will be given money immediately when it is earned, instead of waiting until the end of the week. Give your child a glass jar and make it so the money is always visible to him or her. This reminds your child that money is being saved and is growing.
When your child enters the age of 7-8, they can move on to weekly allowances. This will also be the time that you begin to help them set goals for their saving and spending.
When your child is a teenager, their allowance will increase as will their responsibility with chores. Open a savings account with your teen and teach him or her how to balance it to keep track of deposits and withdrawals.
You can set guidelines on what your child spends their money on. Never let them spend their savings on food, snacks or candy. This habit can spread into adulthood with frivolous spending on eating out.
It is important for parents, as well as children, to learn to control spending. One of the concerns parents have about an allowance for kids, is the sense of entitlement kids can easily develop. If you buy your child whatever they want, they never learn the value of working and saving for something. They are conditioned to expect something now, when they want it. You can see where this could lead to money mismanagement down the road.
In the early years of childhood through teen years, you are a manager. You are teaching money management through an allowance for kids every day, year in and year out. Your reward will be that you have produced a responsible adult, who is willing to work for their money, save for their future, and avoid getting into debt by overspending. Well done!