To Give an Allowance Or Not to Give?

Some parents choose to give their child an allowance and others do not. An allowance can be helpful in teaching children to manage money but is not the only way this can be done.

If you choose to give an allowance:
1. Decide the purpose of the money. Will it be for extras such as snacks, toys, entertainment — or for necessities such as lunch money or bus money?
2. Decide on what you can afford to give as an allowance. Be sure once you make a commitment to an allowance, it is something you can give on a regular basis. This may mean setting it at less than a dollar a week. The amount is not important. What is important is giving your child a sense of money and how to spend it wisely.
3. Be clear on your rules regarding the spending of the allowance. Can your child spend it on anything? Must he save a portion of it? Are there some things that would never be OK for him to buy?
4. Don’t give “extra” money for those things that have been reserved for allowance. Don’t buy them a snack at the store because they have already spent all of their allowance.

If you do not give an allowance, use other opportunities to teach your children about money. When you take them shopping tell them how much they have to spend and make them stick to that amount. Make them aware of how much things cost and help them make good choices.