Allowance/paying kids/incentives

[garddwr]

So my kids have no money of their own and pretty much never have had. I'd like to start teaching them to save and manage money, which means they will need some money. I'm not super excited about the idea of a straight allowance--that feels like building an entitlement mentality to me. At the same time I'm not willing to pay their for their regular chores--those are things we all do because we are part of a family and we all need to pitch in to make things work. I am considering a system where if they meet all their regular requirements cheerfully (school/chores) they would receive a small amount (incentives are good) with the ability to then earn more by doing extra work--they can't earn anything for extra work if they haven't done the basics, and they don't get awarded for doing the basics unless they complete everything (and cheerfully).

 

But I don't know. Introducing money into the family economy feels risky somehow. I'd mostly just like to hear what others have done in their families that has worked. What have you done with regards to paying kids or giving them an allowance that you are happy with?

[AimeeM]

We pay allowance and it is not tied directly to chores. It is given with the sole purpose of learning to manage money.

 

30% save

10% give

60% spend

 

Dd11 receives a base allowance of $50 a month. She has the opportunity to make more (but still has to split the money 30/10/60) the same; she can earn more by taking on jobs I don't care for (lol) - scooping dog poo is a favorite :p

[Maela]

I'm reading a book on this topic right now:The Entitlement Trap: How to Rescue Your Child with a New Family System of Choosing, Earning, and Ownership by Richard and Linda Eyre. I'm liking most of it. I'm still unsure of what my views are on all of this money stuff though. I want my kids to know how to work for something, but I also want them to know that being a part of a group (like our family) means helping out and doing your part to make the group better. I also want my kids to know how to manage money, like you said.

 

Here is our system right now, but I'm not totally happy with it. When my dd turned five, we started giving her a weekly allowance with no strings attached. She gets it no matter what, and she can do what ever she wants with it (obviously if she wanted to buy a beer or tons and tons of candy we would stop that). She also got a set of daily chores. These must be done, and she gets nothing for them. It's part of being in our family. Then we gave her another set of chores that she doesn't have to do, but will receive a specified amount of money for if she does do them.

 

We're considering a change to something more like the system in The Entitlement Trap in a couple of years.

[lovinmomma]

I'm reading a book on this topic right now:The Entitlement Trap: How to Rescue Your Child with a New Family System of Choosing, Earning, and Ownership by Richard and Linda Eyre. I'm liking most of it. I'm still unsure of what my views are on all of this money stuff though. I want my kids to know how to work for something, but I also want them to know that being a part of a group (like our family) means helping out and doing your part to make the group better. I also want my kids to know how to manage money, like you said.

 

Here is our system right now, but I'm not totally happy with it. When my dd turned five, we started giving her a weekly allowance with no strings attached. She gets it no matter what, and she can do what ever she wants with it (obviously if she wanted to buy a beer or tons and tons of candy we would stop that). She also got a set of daily chores. These must be done, and she gets nothing for them. It's part of being in our family. Then we gave her another set of chores that she doesn't have to do, but will receive a specified amount of money for if she does do them.

 

We're considering a change to something more like the system in The Entitlement Trap in a couple of years.

 

Would you please elaborate on what their system suggests?

[MinivanMom]

We give an allowance that is not tied to chores. We have taught our children that we are a family. We are all expected to contribute to the upkeep of our family/home/household and we all benefit from it. We give them an allowance to help them learn to manage money. Once they are old enough to earn their own money (12-ish to babysit, mow lawns, get a paper route), then they will no longer receive a monetary allowance. Obviously, they will still be expected to contribute to the family (chores), as they will still be receiving benefits (food, shelter, clothing, music lessons, etc). We have gone in stages.

 

At 5 yrs: We give a weekly allowance of $1. We teach them to tithe 10%. The rest is theirs to save or spend.

 

At 8 yrs: We increase the allowance to $10 every two weeks. We have taught dd to tithe 10% and save 50%. The remaining 40% is hers to save or spend. Once dd8 saved $100, we took her down to the bank to open a savings account. She was thrilled to learn about interest.

 

Theoretically, we are going to switch to a monthly allowance (of $40-ish) when dd is 10-11 yrs old. We want to add in a clothing allowance at that point also. The goal is to create situations where our kids have the opportunity to learn how to save and how to budget. I don't want them to be learning that for the first time when they bring home that first paycheck.

[Catwoman]

 

Here is our system right now, but I'm not totally happy with it. When my dd turned five, we started giving her a weekly allowance with no strings attached. She gets it no matter what, and she can do what ever she wants with it (obviously if she wanted to buy a beer or tons and tons of candy we would stop that).

 

How about if she wanted to buy a beer for you? ;)

 

My ds12 has gotten a no-strings-attached allowance since he was little, and I don't think it has given him a sense of entitlement. I think it has been a positive thing for him to be able to either spend it all, or save it all, or save part of it, because it has taught him how to manage his cash. He has become quite careful with it, and is never, ever broke. He has a minimum amount of money that he absolutely will not spend, because he doesn't like to be too low on money, and he came up with that idea all on his own, and he is very diligent about keeping track of exactly how much money he has at any given time.

[CanaryMelody]

We pay a small straight allowance for the kids once a month. $1 per year of each kid's age. $14 for DD14, $7 for DD7, and so on. This money is for all of those little incidentals they might want. The amounts are working for each kid so far. $14 is probably a bit low for the oldest but we do cover most of what she wants (at least when it pertains to her horse riding) right now so she usually doesn't want much else besides a book or an iTunes song, etc. Plus, our discretionary income naturally limits what we dish out to the kids anyway.

 

If they want to earn money, we have a list of age-appropriate jobs that each child can do. These jobs are "extra" chores that either my DH or I would have to do anyway but have allowed the kids the chance to save us time and earn a little of money for themselves. Some jobs can be done on a daily, weekly, bi-weekly, monthly, or seasonal basis.

 

My 14yo has things like mow the yard, shovel snow, rake leaves, wash cars, clean ceiling fan blades, etc. My 7 and 5yo can clean the cat litter box in mommy's room, scrub the dining table chairs, pulling weeds, etc. I don't really have jobs for the 3yo but if he tags along and helps his brother or sisters, I'll give him a little something to encourage the work habit.

 

These are all jobs they do after regular chores are complete. We pay as soon as the job is complete. If the job was not done properly, we withhold payment until the job is finished satisfactory (within their abilities). If you want something, you must save; we don't give loans. If you lose your money, we don't replace it. And if you steal someone else's money, you have to pay it back double the amount stolen. It works out fairly well. We try to price the jobs fairly although apparently 50 cents is too little for cleaning the litter box. :rolleyes:

 

I don't find my kids have an entitlement attitude at all. I haven't always given allowances, so my oldest is really learning just how much things cost now. My 3 youngest like to save! In fact, they periodically count their money and see who has the most saved. :)

[Arcadia]

I'm not super excited about the idea of a straight allowance--that feels like building an entitlement mentality to me.

 

Before we started giving our boys allowance, we paid for all their toys year round (within reasonable limit). After we started the allowance, we did not pay for any of their toys purchase. They make their own wish list, than save and budget for them. They also learn to look out for sales and coupons. So instead of feeling entitlement, they are now learniing that they have to wait to get the toy they want, they even learn to price-match.

[Pamela H in Texas]

We do 50cents per year of age.

You get an allowance because you are part of the family.

You do chores because you are part of the family.

***you do more chores because you asked for it --- literally ("mom, you never let me do chores!") or figuratively (energy, behavior, choices, etc)

Giving is heartfelt and part of a good routine. Amount is up to individual.

Saving is done in stages. It is discussed and worked out as needed. It is routine.

Spending is mindful.

[regentrude]

I give my kids an allowance. It does not create entitlement; it is a share of the disposable family income and allows them to learn to budget for the things that otherwise we parents would simply buy (or do you not buy anything for your kids besides basic groceries and clothes?). I have started when they were 5 and gradually increased the amount and the things they are responsible for. It started with things like sweets, a snack at the movies, a toy; now as teens they are responsible for their food when they are away from home, their books, movie tickets, etc.

I do not pay for housework; my kids are expected to help as members of the family. The exception is the larger job of moving the lawn, I pay for that.

My kids are allowed to spend their money as they please. They have made unwise choices, impulse buys they regretted, but also have learned to budget and save for long term goals.

I do not mandate giving to charity; my kids give of their own volition, not because I require them to.

[Alice]

We also do an allowance just for being part of the family. They get 50 cents per year of age per week. They can get it taken away as a punishment but it’s not tied to any specific chores or tasks. We’re still figuring out the chore thing, I’ll come up with a system and then it falls apart. They help around the house a lot but they don’t have a specific list of chores.

 

They each have a savings account and we encourage them to save. We also are requiring them to pay for more things as they get older. They bought each other presents this year for Christmas. They buy their friends birthday presents. At the pool last summer they had to buy their own treats (I packed snacks but if they wanted junk it came from their own $). Oldest son wanted to go on a special Scout outing in Feb and it was a bit pricey so he is paying half. That was mostly so he would think about how much he really wanted to do it. I don’t want him to feel guilty about the cost of things but I also want him to realize that all the activities and fun stuff comes at a price. I’m hoping that it’s more valuable to him because it comes at a cost. Our goal is that in the teen years they are getting more money (we will likely increase the amount) but that they then pay for much of their own extra stuff and learn how to budget.

[2squared]

Another family here with unentitled kids receiving allowances not tied to requirements. At the beginning of the month I bring home cash for our spending envelopes, and the kids distribute it. Dh and I, along with the kids, receive spending money directly from the kids' distribution. None of us seem entitled, but I'm sure that has to do with our overall family values rather than the allowance system.

 

I want to encourage you to come up with a system that's easy to track and implement. Ive tried various tiers of chores and allowances, and it's always just an accounting nightmare. If the kids are in a mood, they dont do the chores which is obviously a choice given the system of no work = no pay, but it doesn't accomplish the goal of earning money for working. Then I was annoyed by having to track everything and needing to always have the correct change. One kid begged for extra chores. He would have put us in the poor house, and how to you say no to someone who wants to work? I have another who doesn't have a natural drive for working, and holding out an allowance was not enough of a carrot. In the end all those systems just seemed like extra work for me, and they didn't drive the behavior I wanted.

 

So now we have a very effective system. You work when I tell you to work. You receive spending month at the beginning of the month. You have complete control over your spending money, but I actively counsel on wise spending choices. I do control the car keys too, so money is rarely spent without me knowing about it. I do pay for babysitting if I would have hired a non-family member otherwise.

[Joshin]

Our allowance is tied to chores. My feeling is you have to work for money in the real world, so you do at home, too. (No offense intended to those that do it differently, this is just what works for us!)

 

My kids have the chores they do as being part of the family - putting away your own laundry, helping mom unload groceries or dad do yard work, taking the dog for a walk, etc. Then they have paid chores. They have a daily checklist and DS12 gets 50 cents per chore and DS7 gets 25 cents (it works out to about $10 and $5 each per week). If they don't do a chore without parental permission they are docked that pay, just like if they missed a day of work. They can ask for extra chores if they are need of more money.

 

We work together to come up with savings goals, and we help remind them so they stick with them. We don't require any charitable giving because they both volunteer time with organizations they support or our family supports regularly, but they can if they want. Once they have jobs we will likely stop giving allowance.

[2squared]

Our allowance is tied to chores. My feeling is you have to work for money in the real world, so you do at home, too. (No offense intended to those that do it differently, this is just what works for us!)

 

I don't work for money in the real world. :001_smile:

[thescrappyhomeschooler]

I haven't read all the replies. I read the Entitlement Trap, but their system was WAY too complicated for me. I read another book called Cleaning House, and we are doing sort of what they did. We just started it, so I don't know how it will work so far. Each kid has a jar in their room. At the beginning of the month, I fill each jar with a dollar for each day of the month. I give my kids a list of responsibilities for each day. If, at the end of the day when I tuck them in, they have not completed all their tasks, I take a dollar out of the jar. At the end of the month, they get to keep 1/3 of what is in there, give 10% away, and we save the rest for them. They can save up for something big like an ipad or other big expense with the money we save for them, if they want. We will see how this works.

[arghmatey]

We put .5*age into our children's savings accounts for each week of the month; we do this this for the entire month on the first Saturday of every month. That means our 3YO received $6.00 for January, and our 6YO received $12.00 for January. This is their allowance, and it is not tied to anything. They observe me making the money transfer, and we go over their interest received and monthly transactions (just deposits we make).

 

They make family contributions every day, and they receive no rewards for doing so. It's my job to teach them how to do these things, so we do them together until they learn to do them on their own.

 

If they do extra things and DO NOT ASK for payment for them, I *inconsistently* offer them money for those things. For example, if they put away my socks and underwear, I might offer them $0.25. Sometimes I will also say, "I will pay you $0.50 to move the chairs to the living room". My 6YO will decline the money or tell me she'll split it with her sister if her sister moves just one of the chairs. =)

 

We do not allow a lot of things into our home, so there has not been a single withdrawal from either of their accounts. At some point, we will begin allowing them to spend a certain percentage, give a certain percentage, and save a certain percentage. For now it all goes into savings. We buy them everything they need and anything they want of which we approve--not much.

 

They received a lot of gift cards for Christmas. Monday, we are going to Target so they may each pick one thing on which to spend their cards. I will then take the gift cards and deposit the remaining balance into their savings accounts. We're not allowing more junk into our house simply because someone gave them money / a gift card.

 

They both have savings goals to pay their way to Disney in two years.