Kids & Money
Should Kids Get a Regular Allowance?
Allowance, earn-only and hybrid approaches
A regular allowance can give children predictable money to manage, while an earn-only system links money directly to work. A hybrid approach can combine both lessons.
What a regular allowance teaches
Predictable income makes it possible to practise planning, saving and living within a known amount. Children can learn that once the money is gone, the next amount does not arrive early just because they want something.
What an earn-only approach teaches
Earning can build a clear connection between work and money. The downside is that a child may have little money to practise managing if there are few earning opportunities.
The hybrid approach
A modest regular allowance can provide money-management practice while extra jobs create opportunities to earn more. Everyday family responsibilities can remain unpaid.
Decide what allowance is for
Is it purely practice money, or does the child need to cover certain expenses? Expectations should be clear so the amount has context.
Avoid constantly topping it up
If a child spends the week's allowance immediately, an automatic rescue can undermine the lesson of managing a fixed amount.
Change the system as responsibility grows
Older children can gradually take responsibility for more categories of spending, preparing them for wages, bills and budgets later.
Put it into practice
Smarty Bucks
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Smart Money for Smart Families.
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