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Allowances can teach kids how to manage, save and value money

Do you ever get sick and tired of your kids asking for one more thing? Ever feel taken for granted because your kids don’t appreciate all you do for them? Ever wish your teen was more responsible with money? Or do you ever wish your children could just wait for something they want, rather than demanding it immediately?

If your answer is yes to any of these, give your kids an allowance. Having an allowance will teach your children how to manage, use, save and value money, as well as develop delayed gratification.  


Do find the right time to start

When to begin an allowance depends on each child.

For example, one family started giving their son a quarter a week at the age of 5 or 6. But because he had no idea what it was for and never remembered it, they stopped until he was 8, when he was more able to handle it. This same family also had a daughter, who piled pennies as a toddler. As a result, the family began her allowance at age 5. By the time she was 7, she bought herself an American Girl Doll, and when she was 13, she paid for a $1,700 violin. 

Do decide on the right amount that works for your family

How much to give is personal and depends on what you expect your child to pay for. You want the amount to feel substantial enough that your child feels motivated to save and build on it. This could be a quarter or five dollars. Some parents give allowance in two or three segments, such as spending money, savings account and charitable giving.

Do be clear about the use of allowance

Avoid allowance battles by being clear from the get-go. For instance, allowance should be for all treats and toys that are not your idea or a surprise. You might give kids money for school lunches that they can save--if they make their own lunch at home. Or you may choose to buy their clothes, but they can add to your money if they want the more expensive jeans or shoes. 

Do allow kids to spend as they choose

Allow your children to blow all of their money. Then empathize and acknowledge the disappointment and anger when you do not buy what your children want--and they do not have the money to buy for themselves. Suggest that your kids save up to get what they want. In this way, allowance is a great teacher of boundaries, and your children learn delayed gratification.

Do pay kids for jobs to supplement allowance

Help your children add to their savings by paying them for irregular jobs around the house, such as raking leaves, cleaning the garage or having a lemonade stand. As kids get older, they might rake leaves for the neighbors or sell some of their old toys at a yard sale. Extra money for birthdays or holidays always adds an encouraging boost.


Do not attach allowance to chores

Allowance should never be tied to chores. When allowance becomes a reward for chores, it loses its teaching value. If it is a reward, it is also a punishment when the chore is not done. This is asking for feuds and resistance.

An allowance is for learning the value of money. Think of it as giving kids lifelong skills, rather than handing over easy money. Giving your child an allowance is like giving your child swimming lessons. Learning to swim means kids can be safe in the water. Growing up with an allowance means kids learn to be safe with money. 

Do not give in to avoid a meltdown

Inevitably you will hear, “I have to have… and I don’t have the money. Can’t you just get me this one thing? I promise I won’t ask again.” Remember to empathize and acknowledge the disappointment. Dont go into, “We made an agreement…. If you hadn’t spent all of your allowance on….” Instead, simply say, “Sometimes, it takes a while to save up for what you really want. Maybe you can think of some extra jobs to do.”

Acknowledge how hard it is when you don’t have the money for something you want, share a story of your own and ask your child if she would like your help to save up at least part of her allowance each week. Help her figure out how long it will take and mark it on the calendar. 

Do not try to fix it or teach

Let natural consequences be a teacher. If a toy is desired that you know will fall apart in a minute or kids want to spend all of their money on one thing, refrain from saying, “You don’t want that.” or “You just can’t save money, can you?”

Instead, ask if your opinion is wanted, and if so, start with “I”. For example, “I wouldn’t buy that because…” But do not force your opinions and judgements on your children. Let them find out that the toy will break, that the money is gone. This is part of the learning process. 

Do not belittle their desires

Kids do not have to get what you think they should get. Don’t worry that what they buy impulsively signals their lifelong taste and desire. Give them the benefit of the doubt and never put down what they like now.

Do not continue an allowance when kids are old enough to get a job

Generally at about age 15, children can start earning their own money by working. This can begin even earlier with babysitting jobs. At that time, explain that kids are now independent enough to make their own spending money. Reevaluate what you will buy and what is their responsibility. Having had an allowance will motivate them to earn their own money.

Jumping cartoon

When children have their own money to spend, they quickly learn the value of what they spend it on. Parents and ATMs are no longer considered an endless supply. And children and parents no longer spend useless time arguing over money and buying. Giving children an allowance sends a message of trust in the child’s capability. Most importantly, a child who is raised responsibly with an allowance uses it responsibly after leaving home.

More expert advice about Being a Better Parent

Photo Credits: Little Girl Doing Laundry. Housework Concept by DMPhoto via BigStock; Check Man, Cross Man and Jump Man © ioannis kounadeas -

Bonnie Harris Director of Connective Parenting

Bonnie Harris, MS Ed, is the director of Connective Parenting and has been a parenting specialist for twenty-five years. Parent educator, professional trainer, counselor, author, and international speaker, Harris is known for her pioneering mind...

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