Should Your Child Have an Allowance? 7 Questions to Ask
It's a question that parents have been struggling with for decades: should our kid or kids have an allowance? There are arguments for both sides.
Lincoln Savings Bank isn't leaning towards one argument or the other, but we do have some questions to ask that will help you decide if an allowance is right for your family.
- Do they need it? Having money will help teach them about saving and how to manage money. On the flipside, it can undermine the life lesson that money is never free. To help you decide, examine possible ways your child can earn money.
- Are you comfortable paying an allowance to your child? This is key because paying an allowance can be viewed as a long-term investment. Use your own experience to help you decide: did having/not having an allowance as a child benefit or inhibit you at all?
- Is your child old enough to have an allowance? When your child shows an interest in money that is generally a good time to start. For most kids, this is between 5 and 6 years old. You need to be sure they can comprehend what you're teaching them, however.
- How much should I pay? Here's a common option: A) pay them their age every week (ex. $5/week for a 5-year old), though this can get expensive, especially with multiple children. Make sure it's something you can afford and isn't too much for their age.
- Is the allowance dependent on anything? This can be tricky. Establish which household chores are expectations and which ones go above and beyond. This will help ingrain that some tasks are necessary while also helping them understand working in exchange for money.
- How do you give it to them? Weekly is the established minimum; you want your child's "income" to be somewhat regular for them to be able to do something with it.
- Are there limits on how it's spent? We recommend the three S's: spending, sharing and saving. You can also make a list of what money can be spent on, as well as what it cannot.
Again, there's no perfect answer to this question, and your solution will depend on your values and how you want to raise your children. We hope that these questions help you come to resolution everyone can accept.
Lincoln Savings Bank can help you manage your child's money if you want to establish a savings account for them. Just visit your nearest branch to get started today!