7 Tips for Giving Allowances

An allowance will help your child learn money management, responsibility, values, goal setting, planning, and saving. These are valuable lessons in life and ones that will make your child a much happier, productive adult.

Give enough - Your child should be able to save money and give some charitable contributions. Saving just $0.50 is a good goal, they aren't saving for a house, and giving to their church or some other charity doesn't have to be large either.

Don't give too much - If your child can afford to buy everything they want, you are giving them too much. They should have to save and choose things they want to buy.

Set a payday - Setting and keeping a payday will help your child learn how to save and budget for things they want to do. Keeping the payday is important, just as your budget would be thrown off if you didn't get your paycheck, so will your child's.

Set guidelines - If you don't want your child buying junk food, let them know. You may also want to set a guideline for large purchases, such as anything over $30 has to be approved by you before being purchased.

Monitor - Keeping an eye on your child's purchases will help you see when there are problems. A child who won't spend any of their money, or a child who tries to buy friendship may need some help from you.

Expect mistakes - Your child will have to learn how to save and they may come up short sometimes and you'll have to step in with a donation. Continually bailing them out won't help though.

Don't use allowance as punishment - Taking money away from your child for breaking curfew won't help, but if they broke a vase, teaching them about repaying may be appropriate.

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