Archived Q&A and Reviews
Just wondering how much most kids are getting for their allowance these days. We give my 4th grade daughter $3/week and my 1st grade son $1.50/week. My daughter has mentioned in passing that her 12 year old cousin thinks that it's horribly mean how little she gets (her cousin mentioned it once to me in a very nice way). So I am just looking for validation - are my kid's allowance amounts way too small? Any feedback you would be willing to share is very much appreciated. Clueless Mom
Your daughter's cousin would think we're really scroogelike -- my 4th grader gets $2 a week, but half of that must go into his charity box, which can only be spent on...yes, charity. He's probably due for a small increase on his next birthday, which is approaching, but he'll still be below what you're giving your daughter.
I have a lot of reasons for keeping allowance low. The notion I hear expressed around here -- $1 for every grade or (shockingly) year of age -- seems nuts to me. Should a fourth grader really have $200 in spending money per year?
My son's $1 a week for spending money means that he gets $52 to spend per year, plus whatever he earns doing special jobs (he does pet-sitting for neighbors and can earn money from me by doing household projects like cleaning the insides of the kitchen cabinets). That means that if there's anything he wants to buy, he has to save for it or work for it, which to me is the whole point of allowance. If he can buy anything he wants, what is he learning? To be yet another mindless American consumer and I think we all know where that leads.
I want him to have to make tough choices about money -- if I buy this now, I won't be able to buy that later. And I want him to buy as little stuff as possible -- to realize that the thing he wanted very badly last week but couldn't afford, isn't actually something he still wants. That, in fact, most of the crap we want is crap we won't want in a month.
And that's my final reason for a low allowance. I don't actually want any more stuff in my house. I have to dust it, nag him about putting it away, find a place for it, and deliver it to whatever charity we're donating to when it's done. Even with my strict rules about allowance and limiting presents to real occasions (ie birthday and christmas) we still have TOO MUCH STUFF.
That's my philosophy. Stand strong! scrooge mom
We give our 13 and 16-year old kids $2/week. Much less than most of their friends. The older one earns additional $ from regular baby-sitting jobs, and the younger one earns $ occasionally. They seem to do OK, including before they were able to work for $. They use it for spending money, and we pay for all their essentials (clothing, school supplies, etc.) and give them more expensive items (like Ipods or computers) as Christmas or birthday gifts. The funny thing is that they always have money and their higher-allowance friends seem to be broke most of the time. I firmly believe that the allowance amount is not nearly as important as teaching our kids to save and use their money well. anon
Here's what we've done with our now-9yo boy. It's complicated, but has provided us with a lot of valuable and varied money lessons - ones that my parents never taught me!
Starting at 6 years old, my son got $1 per year IF he chose to save $5. Half that if he didn't. And no pressure - really! So it was a net of $1 cash for saving, and $3 cash for not saving. (Dilemma!) He almost always chose to save. He could spend cash on anything he wanted so long as it fits in the house rules. Candy-OK. Cheap toys-OK. Guns-Not OK What he learned was that not everything is worth what it costs. He learned how to bank with a teller and how rewarding it is to save. At the end of the year, we took $250 and opened an internet bank account.
At 7 he got $7 if he saved $5 $3.50 if he didn't. Same purchasing rules, but he was allowed to take out $20 for special purchases 4 times a year. He learned to consider choices carefully, and how higher interest = more money. At the end of the year, we took $150 and transferred it to the internet bank account for a total of $400 + interest!
At 8 he got $8 if he saved $5. $4 if he didn't. Everything else was the same, but we added a Charity Jar that gets $1 per week. All year we investigated different charities, and at the end of the year he decided which charity he wanted to give his $52 donation to.
At 9, he gets $9 if he saves $5. $4.50 if he doesn't. Same deal, but we're adding micro-lending into the mix.
It's been really fun and he is learning lessons that will (hopefully) serve him throughout his life. This year we start my daughter too, so it will be interesting to see how she approaches it.
This system may not be for everyone, but it has been great for us. Allowance in our household is not tied to responsibilities - responsibilities exist regardless. We see allowance as a way to teach our kids the rules of money, how to work with it and how to be financially responsible. Good luck! Motley Fool no more....
The expert suggested a dollar for every year of age. For example $ 5 per week for 5 year old seems appropriate. That's how much we've been giving to our 5 year old son. My son was filmed in CBS Money Watch segment about allowances a couple of month ago, see teh link below. I hope this will answer all your questions. http://moneywatch.bnet.com/saving-money/video/beyond-piggy-banks-a-parents-guide/283658/ Lola
Our kids 10&8 get $5 a week. One of those is for a charity fund. 2 dollars they can spend as they want and 2 dollars are put into ''savings''. The savings is for them to buy big ticket items like video games, ipods..... This is a lot of money for them. We buy b-day gifts and some extras. If we are going to the movies I will buy a candy bar for them at the store but if they want something else at the theater they must pay, if we are at Target and they say ''I want X'' they have buy it or put it on the list of things to save for. anon
I'd like to recommend a great book called ''Play the Real Life Money Game'' by Sarah Williamson. It's written for teens, but the introduction is useful in thinking through what allowances are for, and some of the activities can be scaled back for younger kids. Money is never just about money, and it's so loaded for most people. So it's always useful to look at your question from a few different angles and talk it over with different people. The great thing about giving an allowance is that it gets you (and your partner if you have one) thinking about your own feelings and experiences about money, and what you want to teach your kids. Pat
Our system has been this: each child gets $1 per year of age, but half of that is kept in a savings account by us. (My daughter, now 18, has over $3000 in that account now, which will be hers at graduation.) Initially we added a new chore with each birthday, and the kids welcomed it because of the ''raise.'' When they got older, we sort of ran out of new chores to add, but raised the allowance anyway. Now that they are in high school, I will admit their allowance is on the small end. But the eldest gets gas money for driving her and her brother to school, and they both make a lunch sometimes to save on lunch money, which I don't ding them for. It has worked for us. anne
I am a parent of adult children. So I am going back in memory 20 years and can not give specific amounts. Allowance was seen by us as a way to teach money management. We gave them enough allowance to cover, lunches, recreation activities, presents and eventually their clothing and makeup. It was not attached to chores but on some occasions they could do extra jobs to earn some doe. http://www.bankrate.com/brm/news/pf/20070206_allowance_child_age_a1.asp is an article that describes this all very well, check it out. Best to you Jim
I'm blown away by the amounts mentioned in your post, and the post awhile ago about money for baby teeth.
Just for comparison, our 1st grader gets 20 cents a week (doubled already this year). She saves it up to buy gum and other things we don't buy for her.
When she loses a tooth she gets a foreign coin which she saves in a special drawer which also has each tooth in a little colored box.
Luckily for us she's not talking with the kids who get $5/tooth etc.
The big money comes when she does extra chores, like helping weed the lawn. She can earn as much as a dollar or two, and one big day earned $8 and had great fun spending it on a new stuffie (like we didn't have enough stuffies :-)
She also gets money gifts, like $5 - $50 from her grandmothers, and the bigger amounts go into her savings account or get spent on a special toy she picks out.
I'm really curious what other kids are spending their money on? Is it that we buy everything for her or she just doesn't get as much stuff? We have lots of toys, more than she plays with routinely. The toys are gifts from us and relatives and birthday parties, and hand-me-ons.
We live in a small apartment, and the idea of having even $1.50/week more stuff seems alarming. I wouldn't want her to be buying that much candy. Where else would it go? The one thing I think she would have been buying is more clothes for dolls and so forth. We make some clothes, but her collection of dolls and clothes is far smaller than many I've seen.
She loves her stuffies the most, and is delighted with every one she is given or buys, but the 20 to 30 she has seem like plenty to me! (even though we actually have bought her 3 this past year, oh well, but she loves them so)
Looking forward to reading other answers! even more clueless mom (& dad)
I give my 6-year-old daughter $4/week, which is not tied to the performance of any chore or behavior. She is allowed to put $2 in her spending bank and then has to put $1 in savings and $1 in charity. She can't touch the savings and she can use the charity for whatever charitable cause she wants. I've heard a guideline of giving half of the child's age in dollars . . . so I guess my amount is high. But I rarely buy her anything now other than for her birthday or gift-giving holidays (Xmas, Chanukah, etc.) or clothes. In my discussions with other parents, it seems I am giving more than most parents and also that most parents make the allowance conditional. I know there are several schools of thought on this. I love that when we go to a toy store now and she wants something, I can say, ''Great! You can buy it with your allowance or put it on your wish list!'' Anon
I agree with the posters who said that allowance depends on what you hope to accomplish by giving the allowance.
Our family\x92s goal was to have our daughter be able to go away to college with a monthly allowance and have that allowance stretch through the entire month. Of course, that college experience would allow her to spend and save responsibly as an adult after college.
To get to this goal, we expected that high school would be similar to college in that she would have a monthly allowance, but that we would sit down two or three times per year to review: 1. Clothes needed. 2. Activities participated in. 3. School lunches. 4. Entertainment. This agreement would lead to a monthly allowance that she would have to make last.
To get to the high school goal, in middle school we would give a weekly allowance that would cover school lunches and entertainment. However, there would be an annual budget for school clothes shopping, school supplies shopping and camps / enrichment. We usually break this category down into camps for breaks (Thanksgiving, Winter, Spring and Summer) and enrichment throughout the school year.
For elementary school, this is where our daughter is now. She started getting an allowance in kindergarten. She received $1 per week for her age. We discussed strategies, such as long term savings, mid-term savings, short-term savings and spending. However, the money is hers. She spends it as she sees fit. In the beginning she spent her money on a lot of ''plastic crap.'' However, by age 7 she got the hang of it. She is 9 now. She saved for two years to get a Wii and Wii Fit. She earns $9 per week. She often has $50 or more in her wallet. She was given a budget for Summer Camps, chose them well, came in under budget and is attending some great programs.
She works by setting up a lemonade stand twice per year when the local school has work days. After paying for goods sold she averages about $120 or more. She also walks dogs and takes care of neighborhood animals and brings in mail as part-time jobs. In addition, she must give back to her community and volunteers a few hours per week. Allowance is formed from a combination of being part of the family in which everyone has a function and money that is unaccountable to anyone else and being a part of a larger community in which she has been given many privileges by birth and is accountable for giving back to that community.
I have no doubt that our daughter is be financially prepared for middle school, high school, college and adulthood. Mother of a Responsible 9 Year Old Daughter
Hello All: Was wondering at what point is it appropriate to expect that children help in/with the purchasing of gifts for others. Our son receives a small allowance and occasionaly earns extra money doing added chores. He splits his money into ''savings'' and ''spending cash''. We tend to purchase most of his wants, but hope we are not over indulgent. I seem to remember that by the age of 10, I was participating in the acquisition process. My curiosity is more from the point of responsibility than finances. Answering last weeks post, we give our child $2.50/week with possible deductions. Thanks. Too cheap parent ??
With only $2.50 a week, I don't think it's yet reasonable to expect him to try to buy anything for others. It would cost him over a month's allowence for a ten-dollar gift. To simply save up to buy presents, even small ones, for Mom, Dad, and a sibling for Christmas would cost him about four months of allowence. If he had to pay for friend's birthday presents, Mother's Day/Father's Day, parents' birthdays, siblings' birthdays, etc. he would not have any money left at all, kind of defeating the purpose. Charles
I just finished reading the archives and I am wondering what the current rate is for allowances for 8-10 yr olds? Also, what do they purchase with this money? We already ask our son to put 1/3 in savings. Thank you. Nancy
We give our eight year old $2/week which he mostly saves to spend on Pokemon cards. (This is not tied to any sort of chore - - it's just his money.) We also let hime earn extra cash by weeding or carwashing or similar odd jobs. If you are requiring your child to put $ in savings, you should definitely pay more, but this works for us. anon
I have been giving my children a weekly allowance, based on their age. So for each year of age, they get 50 cents. For example, an 8 year old would get $4 weekly and a 5 year old 2.50. This way they get an automatic increase each year, and the rule is very clear and concrete. Just recently I have stopped buying toys for them (they are 8 and 11 years old and our house is full.) So now they buy toys with their own money, and they really pause before they choose to get something! I am very pleased with this. trying to be a financial teaching mama
This may sound outrageous, but my 7 year old daughter receives $7.00 per week, up from $6.00 per week when she was 6 years old.
People, children and adults learn about money from having it, using it and spending it. My daughter has a savings account and is required to save $1 per week. She has also decided that she really wants an iPod. The nearly $300 type. That is not an expenditure I'm are willing to make. However, she has a Credit Union ''Dream Savings'' account and is saving for the iPod. She adds allowance, extra money she earns (taking care of neighborhood pets, washing cars, etc.) and birthday / holiday money away toward the goal. She's half way there.
I am willing to go halves on certain items, such as Healys. My daughter does the online research for the price, together we calculate the tax add it together and divide by 2.
Think of all of the money mistakes you have ever made in your life. Now imagine that you could do that on a small scale and learn from them. It was VERY difficult watching my daughter spend money on things that she didn't want after a very short time, but these are learning expericences.
About Birthday Party gifts: we set an annual amount, my daughter figures out about how many parties she will be invited to and then figures out how much she can afford to spend. She's had to skip a couple of parties - because we ran out of annual giving and she did not have the money. Lessons learned.
It all depends on what the money is meant to do: spending money alone, budgeting, planning, etc. Difficult as it may sound, it seems like it's the adult's responsibility to figure out what the goals are, then to help your child follow through. Believer in Financial Experience
I had to chime in at last on this subject because we and most of the people we know give MUCH less than what other posters say is standard. Our 7 year old gets $1 a week for himself, and $1 for his charity bank, which he can contribute to any cause of his choosing at the end of the year. When he's 8, it will go up to $1.50 or maybe $2. I feel that allowances should be small enough to teach children the value of saving, and the real cost of things. I don't want him to be able to buy everything he wants, even though he mainly wants Pokeman cards and Baseball cards. I want him to have to save for those items, and to ponder whether the five minutes pleasure he gets from purchasing them is worth a month's allowance.
$52 a year in spending money seems ample to me for a seven year old!
He also has the option of doing extra chores in order to earn extra money -- I pay a dollar an hour for things like working in the garden.
I rarely buy things for myself -- we are not well-off, and I believe we have what we need and should be thankful for that. So my allowance philosophy reflects my general bias against consumption, I suppose. nelly
We'd like to hear of other's experience with giving your kids an allowance. Our eight yr son has been asking lately. We're not sure of the amount, or what responsibilities he needs to take on in return for an allowance. Thanks.
I don't tie in my daughter's allowance to household chores or grades. She does chores because she's a member of the household, and is expected to do her homework and get reasonable grades because that is her work. She gets money so that she can (gradually) learn how to use it with some degree of thought and responsibility. Our system for the last several years has been to give her a set amount, plus $1, every week. (Every two weeks now that she's older.) Half of the set amount is hers to spend as she pleases, as long as what she buys is safe and healthy. (This means not spending all of it on candy every week.) The other half she gives to me to keep for her; this is her savings and she must hold on to it for at least a few months to put toward something major/majorish. The extra dollar is for a good cause--usually ends up being given to the Humane Society or something to do with animals.
This is obviously quite a structured system which would not necessarily suit all temperaments. It works for my daughter; now 13, she's become a very good saver, especially now that she's babysitting and has realized she can actually accumulate quite of a lot of money that way.
8 years old? As I recall, our kid got a dollar or two a week, plus some good-cause money.
(By the way, don't be fooled by talk of other kids whose parents give them LOTS of money and NEVER make them save ANY of it. When my daughter tried that one on us for the fourth time, I called all of her friends' parents, asked about their allowance systems, and found that virtually all of them had to save some money and that the ones with big allowances were having to buy birthday gifts and stuff with it. You might try calling your son's friends' parents to check the going rate for an 8-year- old's allowance.) Regards, Melanie
I would like to start an allowance system for my 6 year old son. He's developmentally mature for his age, articulate and now understands the power of money (can buy toys, or save it). I would like to come up with an allowance system that incorporates the following: 1) incentives for good behaviour 2) incentives for household chores (small things like helping set the table now, to bigger things like taking out the garbage, mowing the grass etc. as he gets older and into his teens). 3) creates an incentive to save for BOTH short term needs (e.g. a puzzle or toy he may want) and long term needs (e.g. college). He somehow already thinks/knows that he must help save money for his college education, and he is fully aware that he is expected to go to college. I thought I would work in a way to match any funds he puts away for college to increase the incentive to save. 4) Allows him to manage his own money in a thoughtful way - learn from his mistakes and bask in any glory it may bring him. 5) introduce the banking system to him, which means that when his money moves out of his ''money safe'' and into a bank account we can help him learn about where his money goes, loans, interest accrued, greed (had to throw that one in), etc.
Then what happens to my 3 year old who would also want to participate? I would not want him to feel left out, but clearly he's a bit too young for a ''full'' allowance scheme.
That being said, how do I start? Any helpful hints? Anything you've learned over the past few years now that you have older children? Everyone I know has young children, and they have not started an allowance scheme yet. Thank you for any thoughts. Allowance mom
Re. Allowance for your first grader.
That's when we started our daughter, in first grade.
I think it's important that allowance and ''chores'' be separate -- ie not dependent upon one another. Chores are part of their responsibility as a family member.
Tell the 3 yr old he/she, too, will have allowance start when he/she is in first grade. Leave it at that.
We have had great success having our daughter split her allowance into a ''savings'' bank, that she used for long term purchases for family members, ie brother's birthday; ''offering'' bank, that she donates at the end of the year; and ''spending'' (''S.O.S.'') that she can spend as she chooses. She's taken tremendous pride in making a recent donation from her ''offering'' bank to the Katrina victims and using her ''savings'' for a brother's birthday present. dh
My first grade son would like to receive an allowance. We have discussed the pros and cons, and I think we will probably end up giving him one. If anyone would like to share the specific amount they give their first grader per week, I would be most appreciative. An excellent 1999 post in the archives lists average allowance amounts by age, but more recent information would be useful. Autumn
Hi, My first grader gets $4 a week. He then splits it up into a saving, spending, and charity bank, in an idea that I think came from here. He like putting his saving money in the bank, and usually enjoys going to Glide to donate to homeless programs. I also let him earn extra money for various chores. kean
We've used a system for many years that we started at about first or second grade. I think it works very well. Each child gets an allowance of $1 per year of age, but 1/2 of that goes into savings for them. At each birthday, they get a new chore, or some extension of a chore, to merit their larger allowance and new capacities. I can't say these have always been easy to come up with. Some year's we really haven't increased the chores, only to make a jump up the next. Both kids now do their own laundry, for instance, which makes a real difference! (though I still remind.)
I can't say I've always been thrilled with how they spend their money, but I have to remind myself that my role is just advisory (although of course they cannot use it to buy things they aren't allowed to have.) They've both, in different ways, had the experience of wishing they hadn't spent their money in some way, and we've talked about it, and I think that's been very valuable.
Now that they are older (oldest is 7th grade) they ask about the savings sometimes. We've made it clear that those are to be spent with our approval, generally for college expenses. anne
We started our 6 year old with 1/2 of her age as an allowance. Her allowance is NOT based upon certain jobs, because she does those types of chores as being part of our family (i.e. make her bed, room tidy, feeding dog, emptying trashcans, etc.) She can then get extra money for doing additional tasks as she wants. Also when we started her allowance, we divided the money into 2 banks, one for short term purchases and the other was long term savings which we took to the bank every month. She enjoys going to the bank and giving them her dollars and coins and is now very interested in how the whole money thing works. Kat
an allowance is a great way to teach budgeting and fiscal responsibility (god knows there and many adults who have to suffer before learning such basics and many who simle never learn). my brother and I both were given allowances - it becomes much more important in the teen years and we are both the same about money - we have minimal debt, no credit card debt and are very fiscally independent and good with budgeting. I suggest that you agree with your first grader what specifically this allowance will cover - candy and snacks on outings or new toys, film for their camera if they have one batteries for their toys. agree on an amount I think I got $5 a week when they started with me in the 4th grade. put it in writing and sign it(both of you). then stick to it. if more is needed for whatever reason, the child must pay the borrowed amount with the next allowance (I don't think I was given the opportunity to go into debt until I was 12 and started running up the phone bill) good luck!
I'd like advice on how much monthly allowance to give a ten year old (the info. in the archives is about 5 years old). My daughter will not be paying for any clothes, but will be expected to buy presents for friends' birthdays, etc. We won't tie the amount to doing anything other than normal chores, but we expect her to keep good grades. She has a savings account and has been very responsible about figuring out how much to spend and how much to save. Thanks! Charlotte
Hi-- Ah... i remember when my parents gave us allowances! What an interesting introduction to responsibility and finance. My suggestion, seeing as my mom gave me 25 a day ($1.75 a week) and had me put 75 into a piggy bank to learn to save.... how bout a dollar a day. That seems fair. By the end of the week she'll have $7 and she can put some away into her savings. And maybe as an incentive she can earn bonuses for extra good work & grades, extra chores & help, etc... Have fun! alena
In decididng on an allowance amount, we think about it this way: If we didn't give an allowance, and just decided whether to pay for things when asked, how much and what whould we be willing to pay for? Snacks? Books? Lip gloss (if she's into ! that yet)? toys? movies with friens? Then, add up about how much that would be for perhaps six months, and divide it by the number of payments. You might decide that you'll still pay for school book-club books, for example, but she has to pay for other discretionalry items. Perhaps you'll pay for one outing (movie) per month, but hte restis up to her. I might not expect her to pay for all of her friend's gifts yet, though, because she can't predict how many parties she'll be invited to - maybe she'll make a new friend or two, and then not have enough to get them gifts. We try to review this every couple of years (our kids remind us!) as both expenses and expectations change. We generally opt to give a relatively small allowance (compared to some others), but always give the kids the ooprtunity to EARN more by doing extra chores at home (we don't have any expectations at all to get the ''base rate'' allowance, s! ince we figure some of the household money will be spent on them anyway). R.K.
I work at a foster family agency and our guidelines about allowance go as follows: $5-elementary school age, $10-middle school age, $15-highschool age. This is per week. We also recommend giving extra as reward for doing extra chores or other desirable behavior. All the best, Sarah
Our daughter's allowance is tied to her grade in school; as a sophmore in high school, she receives $10.00 per week: $5 for spending money and $5 to be saved. (She also now gets to keep all of her babysitting money and use it at her discretion.) In 11th grade, she'll get $11 a week, etc. We also give her a $5 per diem for her summer camp counselor-in-training time, which she receives in a chunk before school starts; that's for buying school supplies, clothes, etc. Melanie
I have heard of 50 cents per year of age, so that would be $5 a week for a 10 year old. However, when I thought of that for my 9 year old, I thought it would cover his own toy purchases only. I am intrigued by the idea of his having a budget for buying gifts, it will give him more opportunities for managing his money, however birthdays are so sporadic (1 this month, 4 next month), I think it would be hard to cover the cost in a monthly allowance. Maybe a separate present fund would work. I am also curious what other things families might have their pre-teens paying for. Clothes? eve
General AdviceFrom: Lucy (2/99)
In a recent issue, Consumer Reports listed some average weekly allowances based on a survey they conducted. 8 and 9 year olds got $3.74, 10 and 11 year olds got $5.19, 12 and 13 year olds got $6.66 and 14 yearolds got $9.45 a week. My stepchildren (15 and 11) do not receive this much and I was wondering how otherfolks compare with these averages. A related question is about the going rates for jobs such as babysitting (we have a 15 month old), yardwork, and car washing. The older kids have expressed an interest in more opportunities for paying jobs, butwe're not sure how much to pay them.
From: Jum (2/99)
Re allowances, my two boys are also below the consumer reports averages you quoted. They get $0.25/week for every year of their age (eg 8 year old gets $2). This seems to work, and the best part is that there is no conflict between the 8 year old and the 6 year old. The younger knows why he gets less, and knows that he will get more when it comes his turn.
From: Kathleen (8/98)
There was an article in Harper's or the Atlantic recently that added a great-sounding twist to allowances. The parents set up a virtual bank their kids could deposit their allowances in. The bank pays 5% interest per month (not per year, kids wouldn't have the patience). The kids can deposit any money they earn through babysitting and other jobs into the bank. They can withdraw money when they want and spend their money however they want. Of course 5% interest per month gets costly once the virtual bank balance is very large, so money above a certain level is invested in virtual stocks that the kids choose -- starting, let's say, with one share of Coca-Cola.
The upshot is that the kids have a real incentive to save, and therefore think very carefully about purchases and don't buy stuff they lose interest in the next day. The author says his kids have a lot of fun with the system, and he felt you could start them at an early age because the concepts aren't that complex.