Creating ‘chores’ and an allowance system at home can be difficult to establish. You don’t want to set your child’s expectations too high, but you want him or her to know that the help is appreciated. Depending on your child’s age and abilities, their allowance, or reward, should vary. For example, toddler “chores” such as helping to set the table or picking up toys can easily be rewarded with boisterous rounds of clapping and a little bit of cuddling; this love and appreciation is many times reward enough for them. But, as any parent knows, this stage doesn’t last forever, and (much) sooner than later children expect financial compensation for household duties. Most of us grew up earning a weekly allowance of some sort…typically an amount so miniscule that it MIGHT have be enough for an ice cream cone. But what do kids today expect their weekly at-home-paycheck look like?
Truly, what your family decides as a reasonable compensation in the form of allowances is based on an agreement between parents coupled with a structured system designed to reward work done around the house. While there’s a general idea of what an allowance should be, in the end it’s up to you – the parents – to decide what’s best for your family. Here are a three things to consider when setting up allowances to reflect what kids expect today:
Kids don’t expect an allowance, that is, until their friends start getting them. Once your child’s friends are bringing in their own income, your child will start asking “Where’s the money at?”. With that being said, tailor your starting time for allowances based on when you think your child understands the nature of ‘bartering’. For instance, if your toddler doesn’t quite understand a statement like, “We can have dessert if you eat your dinner,” then it might be too early to truly hit home the idea of payment for chores.
In general, it’s best to start as soon as your child starts to ask about money – and this time period typically falls in preschool year ranges, as that’s when they’re sizing up other kids to see what’s ‘normal’. Preschool children tend to be able to understand the differences between ‘wants’ and ‘needs’ as well, and this marks a great time for starting allowances and teaching the value of a dollar.
2. How Much to Give
This aspect tends to differ the most between families. Take into consideration the following:
- What chores is your child responsible for?
- What is a reasonable compensation for the chores?
Whatever you do, don’t try to “keep up with Jones’”. You don’t want to lead your kid towards an overly-spoiled lifestyle.
Kids today expect an allowance that reflects their age. Standards today utilize a formula of $.50 – $1 for every year of your child’s age on a weekly or bi-weekly basis. For instance, a 3-year-old would start with $3/week. As your child ages, their expectations tend to increase exponentially. Take the opportunity around age 10 to heap on the responsibilities that they crave and compensate them accordingly.
Consider the idea that you want to teach your child good saving and spending habits. Give your child enough money to fulfill some of their smaller ‘wants,’ but not so much that they don’t have to save for the larger desires.
3. It’s More than Simply Forking Over Money
Start with solid rules and methods right from the get-go. Expect your child’s assigned tasks to be completed (CORRECTLY) in order to earn their allowance in full, and stay firm in your conviction. Kids expect allowances, but they also expect that they’ll have to earn it, so make sure that you foster that belief and make it a permanent rule within the house.
You have the perfect opportunity for a ‘teaching moment’, so make the most of it while you can! When you give your child their allowance, consider splitting it into three pots: save, spend, give. In this way, you’ll help to teach your child about how to delegate their funds the same way that an adult would. Allowances are an instructional tool, and if you’re simply forking over money on a weekly basis without enforcement or follow-up, then you’re likely missing out on some key teaching moments for your child.
Get Your Kids Involved in Family Decisions
Children are generally capable of more than we give them credit for, and allowances give parents a way to reward their kid for doing responsibilities that they crave. Involving your children in some of your family financial decisions (like how you delegate money for groceries, for instance) can also help them learn how to save their money for what’s important and necessary. This helps to connect their current situation to the future and it fosters their independent decision-making skills with their own allowances. Remember, in just a few years, they’ll be making financial decisions that dip into the thousands of dollars for college, housing, and even weddings. But it all starts with a few dollars, some chores at home, and the freedom to experiment with allowances.