Moms of 3+ - How do you handle allowance with your kids?

[Heather in OK]

I need some creative ideas from those who do allowance with their children. :)

 

Ideally I'd like to incorporate teaching about giving, saving (my older two already have savings accounts), and a little for spending. But I don't want to go crazy every time we give allowance having to make sure I have enough change for all of them to divide up the money for each (i.e. "This $.80 is for giving, this $1 is for saving,...." X 4). Does that make sense??

 

I just want to KISS. ;)

[Old Dominion Heather]

I've got three. They are 10, 7, and almost four.

 

With their money, their dad tells them when they first get the allowance how much the tithe would be for that amount, except the 10yo, he can figure it out. The little guy just gets some random change right now, and he usually loses it. When he is four, he might graduate to 50 cents.

 

We don't require them to save long term. They do that on their own when they want something big. We just made sure that we kept the allowance low enough so that they would HAVE to save in order to buy anything big. I think right now, the 10yo gets $8 every two weeks, the 7yo gets $5 every two weeks, and like I said, the little guy gets a quarter or some other coin.

[gr8tcook]

The best way to keep it simmple is to use round numbers. We don't give an allowence in the traditional sense. We expect certain things to be done because you are a part of the family. Then there is a list of jobs to be paid for with the dollar amount offered. All of those jobs are round numbers. (ex vacuuming the van is 4.oo) the only job that is not a round number is pulling weeds. (.10 per weed) but that is usually a round number by the time they get paid for it. Our youngest is six and when we pay him 5.00 we pay him in one dollar bills. We have 3 envelopes and everybody, with money in hand distributes their money to the three envelopes. (giving, saving, spending) So we round,if 5.00 is earned 1dollar to giving. 2.00 to saving and rest to spending. sometimes my dd who likes to be exact will ask us to break change but for the most part it works (10% to giving,20% to saving, rest to spend) oh and the envelopes are the small brown package envelopes like when someone mails you software. We learned the hard way that regular envelopes don't hold up to well. this is just one way to do it. hth

[Quiver0f10]

Our system is pretty simple; we don't give allowances. That probably wasn't very helpful though :D

[*********]

We have four dc, ages 3, 6, 12, and 15.

 

We don't require, right now at least, that the children do 'long term' savings. IOW, they save their allowance for things they want, not for college, a car, etc.

 

Their allowance is for whatever they want (with our approval, of course). They do not spend it on clothes, necessary food (they may occasionally buy a speical treat that they want), or any other necessities. It is strictly 'recreational' money. We just don't feel that as children, it is their responsibility to buy 'needs'. Of course, when DSD15 gets a job (which I know she wants to do next year), then the rules might change. She may then be responsible for some clothing expenses, gas/insurance expenses, some more 'elective' needs (like special hair products, for example). I don't know yet. We've not entered that territory before.

 

I think that we give them each a small enough allowance that they are all learning about how to save. DSD15 gets $8/month, DSS12 gets $6, DS6 gets $4, and DS3 isn't old enough yet.

 

DSD15 and DSS12 also get paid for report card grades, as they are in public school. DSD gets more per grade than DSS, since she is in highschool and he is in middle school. They can, in fact, make good money off their grades; much more than off their allowance. They also get cash for birthdays and Christmas from relatives, so IMO, they have a pretty good income. DSS12 has been saving up for a new DSi, and he's almost there.

 

As far as giving, we do not require that each child give a certain amount. We believe in 'cheerful giving', not forced giving. :001_smile: So, when the children get their allowance at the begining of the month, there is a special container for each of them to keep it in. There is another container for 'giving to the poor', and they can choose to put however much they want in there. I can tell you, what each child puts in there ranges from 0-100% of their allowance. We don't tithe.

[KingM]

I need some creative ideas from those who do allowance with their children. :)

 

Ideally I'd like to incorporate teaching about giving, saving (my older two already have savings accounts), and a little for spending. But I don't want to go crazy every time we give allowance having to make sure I have enough change for all of them to divide up the money for each (i.e. "This $.80 is for giving, this $1 is for saving,...." X 4). Does that make sense??

 

I just want to KISS. ;)

 

I've struggled with the same issue. My current plan is to give some of their salary in cash that they can spend how they wish and the rest to buy occasional small savings bonds that can be cashed in when it's time to pay for college. My goal is to have them receive a visible reward for their efforts, but not have every penny go toward candy and other spur of the moment purchases.

 

I'm not sure this will work, as it's something new. I'm interested in what everyone else is trying.

[Miss Peregrine]

We just started giving our 13 yo an allowance. The others will get one when they are teens. It is not just free money and it isn't tied to chores. She is now responsible for buying her own toothpaste, toothbrush, hair stuff, extra clothes she might want, birthday presents, extra trip to the lake with friends, etc.

 

Each year we will increase the amount she gets and the number of things she is responsible to pay for. Right now she gets $20. By the time she is 16 she will be buying everything for herself except for food.

 

I wish my parents had done this with me. I am positive this will be a tremendous learning experience for her.:)

[Ester Maria]

When they were younger, we taught them to keep aside a fixed 10% of all of their "regular" income (allowance is regular income) and at least 50% of all of their "extra" income (the random greater sums of money they get by relatives for special occasions). Up until they were 7-8 we did that for them, then they started to do it on their own too. We don't force them to, if they choose not to do it, it's fine by us, but they usually do it.

The savings are 50% to spend at some point, and 50% to not spend. So, 50% of what they save stays within their reach and can be used to buy concrete things they want which cost more. The rest 50% is long-term saving and the principle is just like in the bank (they can't get the money for whatever is their current fit, but they get extra money for the sole fact they don't spend it).

 

We've noticed they developed a very healthy relationship with money. :D They often put aside 20-30% of their allowance, and even up to 100% of extra money they get (they did their maths and figured how to get the most out of it, even if it doesn't mean immediate pleasure).

 

We also taught them about finance in general, allowed them to see how our family finance works, and we taught them about the market, why is there so much temptation to spend, how to get over that, why one should never be in debt, how to know what you need and what you don't, where's that fine limit. So far, they seem to get it.

We don't teach them to give money to the others (we actually try to teach them to minimize the finance in their relationships with other people, to separate money-issues from people-issues and to help with their effort and time), but if they want to support some organization or activity with their money, they of course can do it.

 

We don't pay for chores, they have to do it because they're part of the family, not because it's their "job". We also don't pay for any other achievement.

We don't require them to work before they are done with their schooling - and that extends to all levels, we will not expect them to work in high school or university unless they want to. Currently, our goal is to try to teach them to make the money work for them when they're a bit older - to teach them about monetary system, investments, etc. We believe that "finance literacy" is very important.

[Heather in OK]

Thanks! Keep the ideas coming!

 

We don't give an allowence in the traditional sense. We expect certain things to be done because you are a part of the family. Then there is a list of jobs to be paid for with the dollar amount offered. All of those jobs are round numbers. (ex vacuuming the van is 4.oo) the only job that is not a round number is pulling weeds. (.10 per weed) but that is usually a round number by the time they get paid for it. Our youngest is six and when we pay him 5.00 we pay him in one dollar bills. We have 3 envelopes and everybody, with money in hand distributes their money to the three envelopes. (giving, saving, spending) So we round,if 5.00 is earned 1dollar to giving. 2.00 to saving and rest to spending. sometimes my dd who likes to be exact will ask us to break change but for the most part it works (10% to giving,20% to saving, rest to spend)

That sounds like something that would work! How do you keep a record of what jobs they have done and what they have earned?

 

Where I've struggled with allowance is that some things just need to be done because it's how a house is taken care of. But they also need to be taught about managing money and given the chance to save or spend it on things they want. I just haven't been sure how to determine what things can earn them money and how to keep track of what has been done and how much they have earned.

 

 

Our system is pretty simple; we don't give allowances. That probably wasn't very helpful though

No, not really since my post was specifically asking those who DO give allowances. :tongue_smilie:

 

Re: Savings - It's not a requirement but our oldest two daughters opened a savings account all on their own motivation. And they have faithfully been depositing money into their account each month since. :thumbup: So I do try to encourage them along with that.

[Guest makinahouseahome]

I have been seeking a way to teach our kids how to handle money. I do not necessarily believe in allowances for work they do that helps to keep the home running. The Lord answered my seeking with an idea from the http://theidearoom.blogspot.com/ . We are going to incorporate this in our home. Maybe it will work for you as well.

[Heather in OK]

I have been seeking a way to teach our kids how to handle money. I do not necessarily believe in allowances for work they do that helps to keep the home running. The Lord answered my seeking with an idea from the http://theidearoom.blogspot.com/ . We are going to incorporate this in our home. Maybe it will work for you as well.

What a great blog!! Thanks!!

 

Her idea plus gr8tcook's might be able to be meshed together.

[mommylawyer]

In a book called America's Cheapest Family Gets You Right on the Money, there is a great description of how they gave allowances to the children based on household chores, home school work completed and expectations within their family - they have 5 children, I believe. A certain percentage of each child's money earned went to charitable giving, a percentage to savings, and a percentage for spending.

 

I can't remember all of the details, but I'm planning to implement their allowance system in my own home next month (so I need to read up). By the way, my two older children, ages 6 and 4, will participate in the allowance plan.

[love2read]

Our kids do extra chores for money. They keep it all in a jar and depending on how often they work, they dump out the jar. 10% goes to charity or church and then they split the remaining in half. One half goes into the bank for college. The other half is split 50/50 between their wallet and a piggy bank. The piggy is for short term savings (a toy, CD, or whatever depending on the age, gifts) and the other the wallet is for pocket money that they can spend wherever.

 

There is an element of control here, because the child has to decide how much of long term savings he wants to spend on himself and he has to be aware of upcoming birthdays, etc.

 

You didn't ask, but I would highly recommend having the kids work for money right from the start.

[nlmullen]

Each child gets the same amount. They have to do what I ask them to do...that is the only requirement for allowance. They have set jobs, but need to be flexible. Don't overload, but expect obedience.

[FloridaLisa]

We expect certain things to be done because you are a part of the family. Then there is a list of jobs to be paid for with the dollar amount offered.

 

This is how we started allowance in our family as well. My friend (mother of 9) warned me that it would get tedious and boy was she right! The kids had to remember to write down their chores and the amount, I had to add it all up, divide by percents, etc. Doesn't seem like much here, but there were always discrepancies regarding jobs they hadn't recorded, etc. While I adhered to the lesson of "write it down so you can be paid," there was still some injustice when my hardest-working-but-not-detail-oriented-boy got less than the youngest.

 

Our new system: I delegated an entire area of responsbility in our house to each child: laundry, sweeping/dustmopping floors, pool care, pet care, trash duty. It's wonderful to train the child to care for the entire area and then let him/her work it consistently.*

 

Amount: $1 per age/per month, capped at $15 (by that time they are earning lots with outside jobs). So, my 10 yo gets $10 a month, the $12 gets $12 a month and so on.

 

Payment date: First of the month, just like dad.

Deductions: 10% tithe, 20% college savings. The rest is theirs.

 

Ages: I don't pay the 4-yo as he's too young. I do plan to give him an area this year (probably setting table).

 

HTH,

Lisa

 

*They learn more than when doing a single chore. They anticipate when we'll be out of chlorine or trash bags or pet food and write it on the grocery list. I try to instill pride in *their* area. And they get really good at their area so that there is less follow-up or reminding.

 

ETA: Certain household work is a given and doesn't earn the allowance. Making your bed, keeping your room straight, additional yard work or bathroom cleaning on weekends. I found paying for each chore created an expectancy that all work was for pay and a bit of resentment perhaps when I wasn't paying for it. Just our experience.

Edited July 8, 2009 by FloridaLisa

[Heather in OK]

Amount: $1 per age/per month, capped at $15 (by that time they are earning lots with outside jobs). So, my 10 yo gets $10 a month, the $12 gets $12 a month and so on.

 

Oh yeah...I like that idea a lot!

 

Thanks so much for the ideas ladies! I think I finally have a way to do this that will work! :)

[Cricket]

Each child has four envelopes. Whenever they get money it's divided into the following: 10% church (or charity), 20% short-term savings (money they are saving towards a goal, they can add their spending money to this if they choose), 20% spending money (money for a toy or candy or gum if they want), 50% long-term savings (this money they don't touch, they will get it when they are 18, hopefully they will have enough for a car or whatever they need at that point). We don't do allowances but our oldest earns money doing jobs for other people. Our younger ones get money occasionally from different places.

 

Our older two boys saved their money and when they combined it with their birthday money from their grandparents they were able to buy themselves a Wii.

[Brenda in FL]

I haven't read all any replies - so forgive me if these ideas have already been offered.

 

I go to the bank at the beginning of the year and get out enough coins and bills for the whole year. I keep it all in an old baby wipe container.

 

Then every few weeks the kids will exchange their coins for bills as they accumulate (so I don't need to have an exact number of coins for the whole year). The youngest exchanges almost every week since he gets 10 dimes (1 for offering, 2 for savings and 7 for spending).

 

They usually keep their spending money in wallets, savings in a piggy bank (they also have bank savings accounts), and we distribute the allowance Sunday am - so the offerring amount goes right to church with them. It helps if the wallets have a zippered compartment for coins.

[Jill- OK]

...are the oldest kids. (Teenagers)

 

This is because we really, REALLY know that they've internalized the "don't expect to get paid for simply doing things that are part of being a family" belief, lol. (They also do quite a bit above and beyond the "call of duty"--babysit on demand, take initiative occasionally, and we sort of continually reward them for that. The little 'uns are...still in training. :D)

 

The other kids have the same system the older kids had when they were small; there are "above and beyond" jobs, outside of normal chores, that they can do to earn money.

 

We try to have separate containers for saving and giving (like someone else said, we encourage them to give, rather than require it), and our bank (where they have accounts) gives out folders with ten dollars worth of quarter spaces in them. (When they have all the spaces filled up, they have ten dollars worth of quarters, and they take them in to deposit). I simply try and give them their pay in coins, so that they can divvy it up, and let them do it.

 

Our older kids have been allowed to do outside work for money (oldest is applying for her first 'real' job), with the stipulation that they put a portion in savings, for college/later life. They're also encouraged to give, and we try and set a good example in that area.

 

Not sure if this is the kind of experience you're looking for...but it's worked well for us!

 

ETA: It is kind of a PITA to have all of their pay in coins, but it does make it easier, in the long run, I believe, to teach them about dividing up money. My husband has a cash box in our closet, and we try to keep some petty cash on hand, for this very reason.

[bunnytracks]

I have 5 kids. Allowance evolves here. When young they get a quarter for helping me with a job (say grabbing the clothes from the dryer and bringing it to me) then as they age it goes to a set price per day, then per week, and now with the oldest they get paid on the 1st and 15th.

 

I do not make the younger ones save or give until they hit the weekly rate. Then we will talk about the reason we believe in giving to charity and why it is important to save. When they get to bi-monthly we expand even further by having them take the time to do long term savings and investing, as well as a rainy day savings, along with having them responsible for paying for activities. Like I will pay for a sport and all that is needed for it but I won't pay for the icecream they buy afterwards. I will pay x.xx amount for shoes and they can chip in for a higher priced ones.

 

I think it is important to give an ample allowance to cover everything you hope to accomplish with it without giving too much. It is important that they have a concept of what it will be once they are out on their own. Too many give money with no strings attached and I believe that sets kids up for failure. You have to work to get paid IRL so not having chores tied to allowance doesnt make sense. I also do not give advances in allowances without charging a "fee" so that they will understand what interest is and that debt is not worth it. I have only had one child ask once for an advance and at the rate of 0.50 per dollar they quickly learned that it is better to wait.

[Desert Rat]

I only have 2 but I like what we do. We give a quarter per year. 6yo=$1.50. Pretty easy to split up for savings that way.