Should You Give Kids an Allowance or Commission?

Post written by ZFH contributor Baker. Follow him on Twitter.

Teaching kids about money is a controversial, but important topic.

Whether we like it or not, money management is a key element of our modern society. Few would suggest that it should be a central part of a child’s life, but even fewer would suggest completely ignoring it as the alternative.

Although there are many methodologies for how to approach the subject, nearly all include some sort of system for providing an allowance. When this happens there are two broad schools of thought:

  • Providing kids with an base, flat allowance.
  • Taking a commission-based approach of tying money to specific chores.

As with any age-old argument, both sides have their advantages.

Giving kids a flat and age-appropriate allowance provides a consistent framework to teach money management skills. The selected payday each week is predictable for children and a routine is more easily established with this consistency.

For example, if they always receive $9 on allowance day, they can quickly pick up that each week they need to set aside $3 to save, $3 to spend, and $3 to give (or similar system).

In addition to the ease of establishing habits, many parents expect the children to help with chores regardless of any monetary compensation. They don’t want to manipulate money as a wedge or as a punishment for not helping. They point out that in the ‘real’ world you don’t get paid to wash your clothes or do the dishes, yet certain chores will always be part of daily life.

On the flip side, many parents are nervous about instilling an entitlement attitude in their kids. They point out that a commission-based system helps reinforce the true value of money. A child can obtain a want faster if they are willing to work harder or take on more chores.

This system also has the benefit of encouraging entrepreneurship. Kids will naturally gravitate towards the jobs and chores that provide the biggest benefit for their effort. They are encouraged to look for additional/creative ways to make money when saving for a purchase they really want.

But what happens when the child doesn’t have an immediate want? Often times this can cause them to neglect certain undesirable chores or even cease working altogether until the next want comes along. In other words, they might learn to only work when they want something tangible, rather than develop a consistent work ethic.

Some fear this mercenary attitude more than the entitlement mentality. When asked to help out, the child might respond with ‘how much money?’ or ‘what’s in it for me?’ In this case, we’ve failed to instill the importance of helping and giving without expecting anything in return.

Courtney and I are considering a combination of the two systems for our own solution.

A system which declares an amount of base chores that are expected whether or not money is paid or not. And in return, a portion of allowance is paid out whether or not the chores are completed.

But extra opportunities are provided on the side if a child is interested in earning more money for a specific goal. These are paid on a case-by-case commission basis, but aren’t expected week in and week out.

As our daughter approaches two years old, we know we still have some time to figure out how we want to deal with this dilemma in our own lives. But, I’m interested what those of you with older children have found works for you?

Do you provide your kids with an allowance or pay them a commission?

46 Responses to “Should You Give Kids an Allowance or Commission?”

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  1. zip says:

    We tried both methods and have come back to giving an allowance. Our kids (11 and 14) aren’t interested in money, hence it wasn’t a motivation for doing chores. Now they have some base chores and help with other things when we ask them. They understand that we all live here, and therefore all help when needed.

  2. Mrs Green says:

    I think this is a really difficult issue, and as with all aspects of parenting we should remain true to ourselves.

    I have a completely different attitude to either a base rate or ‘pay per job’ rate. My daughter is 8 and I don’t pay her any pocket money at all!

    I don’t personally agree with ‘paying’ her to tidy up or carry out every day tasks that are a part of social and communal living; although I respect those that do. She has asked for money for clearing up because her friends get it, but I have explained that I don’t personally agree with it.

    Why should she get money to tidy her own mess?! Just as I don’t get paid for cooking her meals, or keeping the house tidy – I do it because a clean house keeps us all healthier and is more pleasurable to live in, because I show my love for myself and the people in my home by taking care of our life space and because by taking care of everything it models respect for our things and environment.

    If there is something big she wants, she can save up for that with money that she gets from Birthdays, Christmas or the odd bit of money she gets from friends or relatives. She also sells her old books, clothes and toys – this shows her that if she takes care of things they have second hand value. She also has a go at making things to raise her own money and she is free to spend this as she wishes. Occasionally I’ll give her some money just because – perhaps I’ve sold something too or received a gift and it feels good to share that. But I never give her money as a reward, for something she has done etc.

    If she wants something small I’ll just buy it for her; just as I would by myself a small gift or a surprise for my husband or friends. It doesn’t need to have a ‘condition’ placed on it by getting her to earn money for it. The money that comes into the house can be divided up between all of us, for necessary things such as bills, for saving, towards a family holiday and for the things we just want for the sake of wanting….

    I put money into her savings account for when she is older and I buy her one magazine per month of her choice; the same as for myself.

    I’m really interested in hearing what other readers have to say!

  3. martha in mobile says:

    I started giving my daughter an allowance at 3 years of age. This abruptly stopped all the whining and begging which I had unwittingly fomented by arbitrarily purchasing stuff for her (if I was in the mood, if she really wanted it…). Once she had an income stream, she would ask for something and I would tell her whether she could afford it. She got the idea very quickly that she couldn’t have everything she wanted and that some things are worth waiting for, even though I was doing the math for her.
    Her allowance has always been divided into 3 categories: available-to-spend, charity (given annually to the charity of her choice), and long-term savings (she has a savings account and I-bonds). She has chores that she is expected to accomplish as a contributing member of the family. If she wants extra money, she can suggest extra tasks once her required chores are accomplished. If I need her help on something “above and beyond” I do not pay her — that’s part of being a family. If she doesn’t complete her chores, I still give her her allowance, but I won’t take her shopping — if she has time to shop, she has time to do chores.
    This system has worked for us for the past 9 years.

  4. We gave our 2 boys $1/week until they got old enough to earn money on their own through babysitting etc. Now they are teenagers who can get real jobs. Jobs around the house were never tied to money. Rather, we all work, all have obligations and as a family there are things that just simply need to get done. Over time the jobs that our kids have done have evolved. Now, they choose the jobs that feel realistic given their schedule. And teaching them independence has been a part of it. So they sometimes have to cook their own dinner, do their own laundry etc.. And they get it.

  5. Our daughter is 5, and it is only just recently that we have started thinking about giving her an allowance. I think an allowance will give her some early insight into saving up for something special, instead of requesting it from the magic money tree! ( Me )

  6. Naima says:

    We give our kids (10 & 9 years old) UAE Dhs. 10 (about US$4) a week. They must do their chores anyway, and the allowance doesn’t depend on that. The rules:
    1. They must donate at least Dhs 1 each week
    2. They get fined Dhs. 1 for naughty behaviour (hitting, leaving lights on etc)
    3. They get Dhs 1 for for extras (finishing homework before weekend etc)
    4. When they’re ready to spend their savings on something, we match what they’ve saved with an equivalent amount to a max of Dhs. 100.

    It’s worked really well so far, and repeated thanks to my good friend Jo for rule no 2. Great post on a sticky subject :)

    -naima

  7. Michele says:

    This is a great topic! Our family uses a combination of the two systems. We have three daughters, two of whom are 14 and 12. For the older girls we give them a “base” allowance of $10 a week, which is enough for them to go to a movie and buy popcorn for it. (I figured a great way to decide how much to give them is to decide how much it would cost them to go to a movie with friends, as I decided they should be able to at least do that.) They are expected to do certain jobs around the house regardless of the allowance. Then, I have certain jobs that are “above and beyond” for which they are paid a flat rate per job. Finally, in order to further teach budgeting, my 14-year-old has her own checking and savings account, into which I deposit a set amount for her to care for her dog which she trains and shows. She is responsible for buying dog food, paying for conformation/obedience/agility classes, entry fees for shows, etc. (I still handle transportation costs and such.) Budgeting for the dog has been very enlightening for my oldest, as she has been faced with having to choose paying for a class or buying dog toys, and having to decide if she should dip into her own allowance, and realizing just how far her money goes. I’m going to do the same with my other daughter once she turns 13. Both girls are very motivated about saving money, so I haven’t had to reinforce the savings habit.

    The other thing I do is that I tell them I provide the basics–food, clothing, etc.–but they are responsible for the upgrades. If I can get them a decent pair of shoes for $20 and they want the $30 ones, then they can buy it with their own money. I’m hoping this is teaching them the difference between a “need” and a “want,” and that “wants” do not come free.

  8. Melissa says:

    My boys are 3 1/2 and I give them a weekly allowance that is not tied to chores. They get $1.50 a week (I read somewhere that a good amount for an allowance is to take their age and divide it in half). They put 10% in their savings, 10% in their “giving jar,” and the rest goes in their piggy bank. Each week, I give them their allowance in different coins. They sort and count the coins and we talk about value. If we are ever at a store, and they want an item, we have a discussion about how much money they need to save.

    They also have daily chores, “because we all help to keep our house look nice.” I have a chore chart with a few simple chores that each child is responsible for (they trade each week). They can earn a star for completing the chore, which provides a nice visual and helps them to recognize the days of the week. There is no money tied to the chores. If you don’t do your chore, you don’t do the next play time activity until the chore is completed. Although they rarely complain about the chores, as I’ve assigned small, quick tasks that they can complete easily. The chores they do are: make your bed, empty the small trash cans into the big kitchen trash can, dustbuster the floor, help empty the dishwasher, feed the cat, set the table for dinner, and help sort/fold the laundry. They are also expected to clean up their toys, put their shoes away, and take their dishes to the sink, but these are not listed as chores, they are simply expected. Each week on allowance day, I also switch their chores. They each have to make their bed, but the other 3 chores rotate.

  9. Jeffrey Tang says:

    As you said, Baker, there are pros and cons to each system. What’s most important, I think, is consistency in implementing whatever system (or mashup of systems) you choose. Also important is allowing your kids to actually own the money and use at least part of it in whatever way they wish.

    Growing up, my parents were never quite sure how to approach the money issue. Sometimes I got allowance, sometimes I didn’t. Sometimes I was paid for helping with extra chores, sometimes not. Wasn’t a particularly confidence-inspiring setup.

    The other problem was that I never actually got to use most of the money I earned. Most of it was sucked up into the vague “college fund” void. The bits that I got to hold on to were managed more by my parents than me. I couldn’t decide to buy something with “my” money unless given permission. Again, not very inspiring.

    Great post, Baker. Always enjoy reading what you have to say!

  10. Dan says:

    Great info. I read a book titled ‘Young Bucks’ last year. One theme is to tie your childs dreams and desires to a way they can make money. This may be from the parent in a commission based chore system of some other idea they have -instilling an entrepreneurial mindset. We live in a world full of opportunity and kids can identify these as easily as we can. So the money doesnt just have to come from mom and dads wallet. This is not part of the standard expectations set for the childs behavior like keeping tidy. The lemonade stand is the easiest example but there are many more ways for children to begin learning about how money can be a part of a happy life.

  11. My son is nearing 2 years (same as Baker) and I’ve been contemplating this issue also. Of course I dont expect to start the actual system for another year atleast but this debate is interesting and the comments are helpful in making a decision.

    My own parents gave a meager but fixed allowance. Chores weren’t tied to money (they were tied to mom’s shoe sailing towards you!). So in a way I never really got that entrepeneurial mindset. But then I did learn budgeting and what not from an early age (my major expense was a bar of chocolate and a book). Lunch money was part of the allowance and so if you wanted to eat at school you paid for it.

    Let’s see what I decide for my son.

    -Aly

    http://discomaulvi.wordpress.com/
    http://www.twitter.com/DiscoMaulvi

  12. Kevin M says:

    I like Michele’s approach – providing “needs” for her kids, but making them pay for the upgrade to a “want”.

    My parents tried several approaches while I was growing up, but an allowance seemed to work the best according to my fuzzy memory. We haven’t talked about the approach we’ll use with our son, but like Baker’s daughter he’s only 2 so we have time. I like the idea of encouraging them to save and donate a portion of it though.

  13. Kelly says:

    For our family an allowance is a tool to teach the kids about managing money. So they are given complete control over their allowances. Their allowances are based on their age, so the 3 year old gets $3 ever other week, and the 7 year old gets $7.

    I think you have to decide what the purpose of the allowance is and then go from there. It doesn’t have to be set in stone, we plan to change things up as the kids get older and have more expenses they are responsible for.

    I wrote a post about it where I go into more detail:
    http://www.thecentsiblelife.com/2009/09/25/kids-and-allowance/

  14. Wojciech says:

    Awesome post, Baker. I’ve never heard of or considered a commission-based allowance system (probably because I’m just now having my first child), but it sounds like your combination of the two is a really neat idea.

    It’s amazing how “kids these days” (listen to me…I must be getting old) have a really strong entitlement attitude. The parents that are preventing that are raising kids that can take care of themselves, which I commend.

    Can’t wait until I have to make the decision for my own kids. :) Should be fun…

  15. My husband and I do exactly what you are contemplating. Our kids receive an allowance not tied to their basic chores – those are expected of them. They can, however, lose their allowance for not meeting expectations at home. But that can be chores, homework, not calling when you’re going to be late, any number of things.

    When the kids are really aching for something that they know we will not purchase for them, they will often ask for “extra” work. These are usually bigger tasks like raking leaves (a multi-weekend project at our house), or cleaning the attic. Things that need to be done, but usually require a lot more work than the general duties. Said child usually negotiates a rate with the parental unit, and it goes from there.

    We have also introduced a savings concept with our kids – a certain portion of what they earn, either from allowance or other tasks, must go in their savings account before they spend any other money. I want my kids not only to know the value of money, but the value of saving it.

  16. Scott Gale says:

    This is the age-old debate…do they do chores as part of their “family contribution” or do they get paid to learn some life lessons. In our home, we’ve done both at various times, but I think we finally struck the right balance.

    We’ve allocated certain weekly dollar amounts to various household jobs (i.e. unloading dishwasher, folding laundry, getting newspaper, taking care of dog, etc.) Each kids is assigned a minimum dollar amount that they must earn. Each year, they take turns choosing chores until they have reached their minimum. They must complete them in accordance with scheduled dates/times, or their allowance gets docked. In addition, if they have not completed any portion of their chores, they cannot watch television, play video games, or visit friend’s houses.

    Since they know they can’t ignore their responsibilities, they generally get them done on time in order to get paid.

    In my book, Your Family Constitution (www.yourfamilyconstitution.com), I outline our chores/allowance method, as well as some interesting methods from other families that I learned while doing research.

    thanks for the opportunity to share my thoughts.

  17. Paula says:

    we are just about to implement pocket money for our three kids (10,8,5). This is not dependant on doing chores/ behaviour as we expect them to do this as part of family life. we dont want them to say ‘I dont need the money, so I am not doing X this week’!

    We have decided that, starting Jan 1 we will give the oldest two $104 (ie $2 pw for 52 weeks) which we will keep in envelopes. the youngest one – with absolutely no money sense will be given a small amount if, and when, her brothers spend their pocket money on lollies etc. if they want the money they can ask for it (this will allow us to monitor spending/make suggestions) we have told them they can spend as much or as little as they want – they can spend it all at once, or a little each week, and at the end of the year we will give them 10% (flat NOT comound!) interest on their balance. we have set up little ‘spending spreadheets’ on the computer, and shown them our budget/expenditure sheets, so they/we can track their spending over the year. We have pointed out that if they save the whole amount by jan next year they will have $114, plus another $104 which would buy something really impressive, but we are not going to nag them about what they choose to spend their money on. we will continue to give them treats as we normally would – eg occasional icecream/lollies on a family outing, so there is no expectation that they need to spend this money on anything they usually have.

    Hopefully they will realise that frittering away money $1 or $2 at a time on lollies is a waste, and saving it is preferable. time will tell.

  18. I’m also still a few years away from committing to anything yet (my girl is just about to turn one), but I am in favor of having a certain assortment of regular chores that are expected to be done, with no monetary compensation whatsoever. To me, that’s just part of being in a family.

    But I also am looking forward to encouraging my kids to be entrepreneurial. If Lucy comes up with something she wants to buy, then I think I’d like to give her a few scenarios to choose from, i.e. a handful of extra chores to be completed for an agreed upon payment. We’ll see.

    Thanks for starting the discussion. It’s an important aspect that a lot of parents mess up, which is part of the reason we in America are in the middle of a credit crisis.

  19. b kinch says:

    Our kids get a small allowance every other week-their pay schedule is the same as ours. They’re part of the family so they get a portion of the family wealth. They also do daily chores and help out with big projects. Again, they’re part of the family so they share in the household work, but the two aren’t really linked.

  20. My kids get a small weekly allowance that is indirectly linked to chores. We put any money from birthdays or Christmas into their savings account. Their allowance, however, is purely spending money. I hope that by the financial choices we help them make (saying “No, I won’t buy you a $60 pair of jeans, I only have $20 budgeted”) will guide them to making their own good financial choices. They have seen both sides of us – parents that spend outside their means and parents on a strict budget!

  21. I definitely don’t pay them to do their jobs like helping clear the table, putting out the rubbish. They just know they have to help out. They get a small amount of pocket money (about 50 cents per year of age) and spend it mostly on sweets (lollies, candy) which just about kills me. One’s a spender and one’s a saver which is interesting.

    Oh, and if I have to nag them too much to get ready in the mornings or if they are rude in anyway I dock a dollar here or there. That makes them pull their socks up pretty fast:)

  22. Zengirl says:

    Baker,
    Good topic, as a parent I am very confused about the whole allowance thing. When I was younger, we helped out in a house because we were part of the family and not because my parents paid me to do chores. Ofcourse, I did not such a choice existed and that helped.

  23. Tam says:

    I have two little boys 6 yrs and 4 yrs and our current system works like this . . . Each child has a chore chart of tasks they are expected to complete each day (make bed, clean room, homework, practice piano, do a mom job (something I need help with–folding laundry, putting away dishes, etc) and tidy toys). IF and ONLY IF all of the above have been completed, they can ask to do a money job. These are above and beyond the kinds of things I normally would expect of them (polish kitchen cabinet doors, dust, wash windows, clean baseboards, vacuum the car, pull weeds, etc) that they can do to earn money. Any money they earn they put 10% to Charity, 10% to savings (for college) and the rest they can do what they want with. So far it seems to be working very well! We don’t pay a lot for the extra jobs and my oldest has almost saved up $20 for a lego set he really wants and turned down a weekly visit to the ice-cream truck with his friends because he realized that if he hadn’t spent the money on ice-cream last week, he would have enough now for the legos. Just the kind of lesson I want him to be learning!

  24. Suzanne says:

    Although my kids are only 7 and 4, I have already tried several different set-ups trying to find which works best for us all. I still haven’t found “the one”. The difficult part for me is that each of my children are the opposite in natural motivation and inclination to pressure/demands/requirements. Thankfully, I guess, they are both the same in that although they act interested in an allowance or earning money, they don’t care that much about money.

    Whether it was an incentive system that called for earning enough stars through positive behaviors to fill up their chart and claim their prize or by doing specific tasks with an assigned dollar value, my kids worked equally diligently in the beginning and then the enthusiasm was gone. Each system limped along for quite awhile because I tried to keep the subject in the forethought of their mind and decision choices. That is definitely no fun for me!

    So, for right now, we are again in-between systems and doing nothing on the daily/weekly level. However, when my kids get money (just change from grandpa’s pocket on up to gift money in a card for their birthday), they’ve learned to leave it in their savings account until later…because that way they get to forget about it (their way) and the bank says thank you for letting them use it by giving the kids some money each month (interest) The kids are happy and so am I. I’ll keep trying, though, and keep my eye out for when they are ready. There are valuable life lessons to be learned and I don’t want them to miss out!

  25. lanette says:

    I give my son $5 a week allowance – currently he puts $5 per month for college, $5 to contribute to our family cell phone and $5 for his texting plan – leaving $5 a month to spend. Personally I like that my middle school age child has very little cash to spend. He is currently saving for a Mac laptop so he is being paid extra to mow the lawn and other chores as needed. Over the years he has saved and paid for his own Gameboy, guitar amplifier, and a Nintendo DSI. I feel that he is really learning some money basics.

  26. morgin1013 says:

    I personally don’t pay an allowance. I don’t believe in paying my child money to do what is expected to help the family because to me it’s just part of being a family. There are simply things that need to be done in any household (dishes, laundry, ect) and as part of the family I expect my son to help same as everyone in the household and he has a list of things he knows he is responsible for. One day he’ll have to do all these things in his own house and won’t be paid for them. I do however give him plenty of opportunities to earn money by doing “extra” chores” like washing the cars, or cleaning my bathroom (just really anything that needs to be done that he wouldn’t usually do including my chores) so that when he needs money he learns to work for it same as he will as an adult. I also let him control his money at this point as he is 16 when he was younger I held it for him and helped him decide how and where to spend it but basically let him spend it as he wished. We had many a discussion about are you sure this is what you want and if you spend this now you can’t get X that you have been saving for. He has learned the hard way a few times about not getting what he really wants because he already blew his money on something silly. It has helped him learn how to save. Sometimes I also barter for a specific item if for example he wants a new skateboard and doesn’t have the money I will tell him a list of things he must do and once they are complete to my satisfaction I purchase the item for him.

  27. OMG – reading the comments I got worried that I’m behind the times. My daughter is 6 and I’d not even considered this issue and I now think it would be a good idea to do so!

    I agree it’s not an easy matter. I’d prefer she continues to help out with the chores because she wants to help (which she does at the moment) and I’m nervous that attaching a ‘reward’ to it will change that in a way I’m not happy with. On the other hand I’m not keen on her getting an ‘entitlement’ approach to money.

    I think I will talk to her about it and come up with a plan togther.

  28. My daughter’s only 16 months old, but I’m leaning toward eventually giving her a weekly allowance. I want her to know that family chores are part of maintaining a good household. After all, I don’t get paid for any housework. I like the allowance method, although I’m sure the chore-for-money method would work for others if implemented well.

    That’s just my school of thought.

  29. Kim says:

    We have two kids, ages 5 and 3. They both do chores and have a weekly chore chart that is filled out daily. We are teaching them that there are certain things you have to do every day for yourself and as a member of a household. We also started giving our daughter (age 5) $3 a week allowance. She is expected to pay for any “discretionary” expenses out of this. If she wants to go see a movie, have a Happy Meal at McDonald’s, buy the hot lunch at school, save up for a toy, puchase a special item of clothing etc., it’s all out of her own pocket. We didn’t say anything right away about saving, spending, or charity, but she’s coming to these things on her own and we do discuss and explain them where appropriate. It’s been two months since she started getting an allowance and I’m impressed by how savvy she already seems about the value of a buck. She hasn’t really wanted to buy too much and now has a pretty sizeable nest egg. We plan to let the kids earn extra money with additional chores as they get older.

  30. Jen says:

    Funny, the system that Mrs Green described is exactly how my sister and I were raised. There were times when I was an older kid and a young teen that I was jealous of friends who got an allowance, but I also realized that I probably actually had more freedom than they did and ended up with things I true loved rather than what I thought I should spend money on in the spur of the moment.

    However, what is more interesting is the long term outcome of that style and specifically the difference between my sister and I. While I tend to be very responsible with money and save before I buy things, my sister spends every cent she earns almost as soon as she earns and still lives paycheck to paycheck at almost 28. But I also don’t really believe that she would behave any differently has she been given an allowance or a commission. I think the child’s personality has a lot to do with how they will eventually view money.

    One thing I do think is really important is discussing money with your kids. My parents never did, and my spouse’s parents did too much (causing him to worry about money). We are hoping to strike a balance between the two extremes! Great article and really great comments!

  31. Joel Drapper says:

    I would recommend giving a consistent amount for consistent chores. Adults get pretty much the same amount each pay day, but though the jobs they do at work may vary, they’re pretty consistent hours. Then you get the benefits of both sides.

    Basically you get the same amount each week, but that’s for doing chores through the week.

  32. Here’s one I’m kind of surprised I haven’t seen yet: The Bank of Parents.

    Our mom setup a notebook with a balance sheet for each of us kids. When we had extra money we wanted to save, we could “deposit” it by giving it to her, and noting it down in the notebook. This worked well, since it made handling birthday checks easier, since we just had to endorse them, hand them to a parent, and write down how much it was for. It also gave Mom a supply of cash, which meant less trips to the ATM.
    Our allowance was then 5% monthly compounded interest, so our allowance was only as big as we planned it out to be. This worked out to be 41 cents on the $100, and we typically had something along $400-$700 in our accounts at any one time, though both of us managed to get up to $1000 at one point or another.
    As for getting the money out, this is where it got good. The parents would keep ~$20 in the notebook, so we could easily withdraw a few dollars to go out with friends, but if we wanted to buy something big (gameboy, scooter, etc), we’d have to go to the parents with a spending proposal, and get them to approve it.
    This meant that not only did we have plenty of spending money to do with what we liked, and had incentive to consider the lost opportunity of spending that $25 birthday check from Grandma right away, but our parents still had tremendous control over our major spending habits. Then once we went to go open our first checking accounts before college, they just wrote us checks for however much was in our “accounts” as our first deposit in our real accounts.

  33. Elisabeth says:

    Our girls (16, 13) get an allowance which is based on a budget of real expenses: they have lunch to buy at school (if they choose to), monthly bus passes and “misc”.

    We gave them the math problem of calculating how much they needed (honed their math skills) and we pay them every Sunday. Chores are not tied to the allowance but they are expected to do their part.

    We pay for “needs”, such as one pair of shoes per season, winter coat, school uniform, etc.

    They pay for “wants” such as two, three or even four (!) pair of shoes per season, that really cool belt, another purse because they have 10 already, etc.

    I must say the system is working great. I was tired of giving money every day for lunch, and then worrying once a month about the bus pass.
    Now they do all of the work.

  34. Grace says:

    I felt my daughter was ready to start learning about managing money at age 8.
    She is 16 now and recieves an allowance of $40 a month. She has assigned chores that are required, but they are not attached to her allowance. If she needs extra money there are extra chores she may do. When her allowance was attached to chores she would decide she didn’t want the money and the chore wouldn’t get done.

    She will not be allowed to have access to a car until she can pay for her insurance and gas. I’m hoping this will motivate her to seek outside employment.

    Like Elisabeth, I buy only very basic things for her. 2pr. jeans, tennys, undergarments and jacket as needed.

    Still she seems to blow her money on music, games and movies. encouraging her to save has been a challenge.

  35. Of course we have to give them money for their needs, that’s already a given but I do think we also have to give them the chance to earn for things they want to buy. I personally wish my parents would’ve done that for me. Though I am thankful that my parents gave me everything that I needed back then, I wasn’t too fond of getting socks and shirts all the time on birthdays and occasions and I’m still quite disappointed with the fact that I almost never got any toys from them, even though they could afford it!

  36. Bob says:

    I love how my mom did this with my sister and I. We got a laminated grid with each of our weekly chores listed for each day: most of them were fairly simple, like making the bed, helping do the dishes, feeding the animals, and a few other things. On each day that we did the chore, we made a mark in the grid. Each mark was worth ten cents. Therefore, at the end of the week if you’d made your bed every day, you got 70 cents, and another 70 cents for doing the dishes and other “daily” chores. Then there were ~50 cent to $1 chores that were sort of one time or once weekly things, like helping with the laundry or raking leaves or mowing part of the lawn. At the end of the week, Mom tallied up the total. It was usually somewhere between $3-5 dollars, but of course the monetary amounts of the grid could change over time, from 5 cents to 10 cents. The daily chores were basically on the honor system, but it was visibly rewarded. It’s also stunning as a child to realize that a bunch of puny 10 cent jobs can add up to nearly a dollar at the end of the week! At least, it was to me. I think this combines the commission and flat allowance idea.

  37. Tina Fortune says:

    Great post! I pay my kids a stipend to go to school and perform. My children are 13, 11 and 5 and in the 8th, 6th and Kindergarten. I started paying them a year ago after my Director mentioned that he paid his kids. I was intrigued and asked him to explain. He asked me if I was paid to clean my home and of course I said no. So he said why should the kids be compensated for it. True! He told me to use my own method. I thought of a system that would work for me since I was a single/divorced mom of 3 and not receiving child support. I went with paying them $10 per grade level. A’s=100% B’s=50% for instance, my 8th grader can earn $80 per month. She has six classes so each A’s=$13.33 and B’s= $6.67 I do not pay for C’s or lower because in life we don’t get paid for below average work. Well, let me tell you, this method works! They work so hard and they love the idea of getting paid and having a budget. They still perform all of their chores and have a free day on Saturday’s and Sunday’s when I take their chores. Remember, we don’t get paid to do clean. I stress that we’re a team! My Kindergartner? He gets $5 per month and he’s happy too!Especially when the Ice Cream Truck comes along. Super post!

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