Kids and Money – Tips for Setting up an Allowance

Tips for Setting up an Allowance for KidsWhen our daughter was growing up, she had chores that she completed to earn an allowance. We started her allowance when she was 7 years old and it continued until she was 18. It was a great way to teach her responsibility and a nice way to teach her how to save the money she earned.

Now that we have a 7 year old granddaughter who is at our home several days a week, we have set up a chore list and allowance for her too.

Here are some of my personal tips for setting up an allowance for kids.

Kid's Chores Checklist

1. Set up a weekly or bi-monthly allowance and payment plan with your child. Sit down with them to make a list of the chores you expect to be completed and how much each chore is worth in the allowance plan. Come up with amounts and a list of chores that BOTH of you feel comfortable with.

2. Hold your child accountable! If they don’t complete something on-time, not-at-all or do an unsatisfactory job at it…deduct money or omit money from the allowance. Let the child know up-front that this is how it will work and the consequences for them not completing a job. This will teach them responsibility and consequences for their actions or the lack thereof.

3. Keep the chore chart and the “things to do list” in plain view for both of you to see. Matter of fact, make copies of it (or write it down on a chalkboard or write-on & wipe-off board) so that you both can track the results throughout the week. This will allow you both to see what is done and what still needs to be done at a glance.

4. Even at a young age, teach your children how to save money! When you set up the allowance program with your child, decide how much money of their allowance has to be saved and put into a bank account for their future. If you don’t want to come up with a percentage, you could come up with a “money-earned matching program” which is when you match the amount they earn every week with a deposit into their saving’s account.

Example: If they earned $5.00 by doing chores, you match that $5.00 with a deposit into their saving’s account.

5. Set a good spending and saving example for your children! Let them see how you go about spending your money and saving it. Teach them how to be frugal, how to shop around for the best deals and how to save their money for the more important things in life. Children learn best by watching YOU!

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Comments

  1. Jo-Ann Brightman says

    I like how you divided the chores up and assigned an amount to each chore. It is so important to teach kids how to make and save money.

  2. I have one of those coin jars! I like how it tells you exacly how much is there. The bad part is if you unscrew it, it isnt right anymore.
    I like how you hold the child accountable. I did that too, and they quickly learn how easy it is to do things. We never had an allowance, we just had chores. If we did something not normally done we could earn money or we shoveled or mowed lawns.

  3. Tamra Phelps says

    I wanted an allowance as a kid, but never got one. I think it’s a great way to teach kids how to save & budget money.

  4. Cathy Jarolin says

    This is a clever list for them to make & Save money and for you to make sure they do their chores. I bet this works like a charm. When I think back to when I was a little girl. My sister and I each got a quarter a week allowance and we did what ever chores we were told to do. I hated yard work so much and that was what I always had to do! Lol! As far as saving we went to the corner store and bought a whole bag of penny candy for our quarter and came back and ate it! Lol! those were the good old days. Great tips for the children now a days. 🙂