Why Should Kids Get Allowances The question of whether allowances are right or wrong, is one that has been argued for many generations. Now it’s your turn to decide whether or not an allowance is the best way to educate your child about financial responsibility. There are many reasons given on why a regular payment of money to a child should or shouldn’t be done – ultimately I believe there is no right answer, it is up to each individual family to decide what is the best option for them. Through many years of working with parents and educators, these are the top seven reasons I keep hearing on the question of why should kids get allowances. 1. They learn to be wise with how they spend their money. It may help to teach them how to prioritise their spending, & learn from an early age what things are a waste of money. 2. They learn how to save money. Having a regular amount of money, may make it easier for them to establish good saving habits, as a certain percentage of the money from each payment can be placed into a savings account/piggy bank. Without an allowance, any money they receive, may simply be spent, with nothing going to savings. 3. They learn how to donate their money. A certain percentage of their money can also be allocated to donations to the needy, hopefully encouraging your child to be more thoughtful of others, & not greedy with their money. 4. They will learn how to budget their money so it lasts between payments. Eventually, most children will learn to be careful how they spend what limited money they have, so they don’t run out of money. This will only happen, if the parent doesn’t give in to the initial whining for more money when the mistake is first made! 5. They can learn to make mistakes with small amounts of money. Kids will learn how to manage their finances responsibly far quicker through being allowed to make mistakes themselves (and suffering the consequences), rather than being told how they should be managing their money by someone else. Parents need to be there to guide their children on how they should spend their money, but not dictate (unless there could be serious consequences from their mistakes). 6. They may stop nagging you for money. The idea is, if they are receiving a regular amount of money, and they have a good understanding of how to budget it then they will never run out of money, so won’t keep pestering you for more. Realistically, it will probably never put a complete end to the nagging for money, but it should reduce it. 7. You may end up forking out less money. If you sit down, and add up how much money you give your child during the week & how much you spend on items for them (e.g. clothing), it may actually work out cheaper to give them an allowance, and make them responsible for a lot of their purchases. Click here to find more fun games & activities, printable charts plus over 100 colorful money worksheets your child won’t want to stop doing! Make sure you sign up for our free newsletter to receive your 10 complimentary kids money worksheets.
Copyright 2006, Rachel Incoll, Kids Money Tips. |