There are a lot of opinions out there around how to give allowance, when to give allowance, and what allowance should be given for. I choose to regularly give my kids an allowance because it can be an important tool to help them learn about managing money. BUT, if done incorrectly, this tool can easily turn into a weapon of mass destruction! That’s why I wanted to share with you the three mistakes you might be making when you give your kids their allowance.
Consider this blog post a no-judgement heads up based on mistakes I and other mom’s I know have made and had to recover from.
When we give children an allowance for completing chores, we are reinforcing the idea that they only need to complete those tasks when there is a reward. What happens when they become an adult and nobody is paying them to do their dishes? Kids need to learn that they don’t get paid for chores that are vital to living and maintaining a home! Having a clean house and a well-managed life is the payback.
Our relationship with money is often a direct reflection of our own parents’ relationship with money. That’s why teaching our children how to spend and save wisely is SO important! Give them an allowance large enough to pay for everything except what they need to live. Then teach them how to save! 15% of their allowance should be set aside for emergencies and large purchases. Now….I know what you’re thinking…..OF COURSE if there is a real emergency we will step in to help! But we want to train their brains to save for these types of life events as early as possible. Make it a rule that they will not receive their next allowance if they do not save 15% of their current allowance. This will start to teach them the value of putting money aside for the future!
This is the same logic as Mistake #1. Rewarding behavior should NOT be tied to money. Kids must be taught how to have integrity! If they are only doing the right thing because they think they will be rewarded with money, then we are sending them the message that they don’t have to be good if there is no reward. Whether we are aware of it or not, they are modeling our behavior. So if we want to teach our kids good behavior, then WE have to show them how by practicing what we preach. For example, if we want our daughters to have self-confidence, then we need to make sure we are speaking about ourselves confidently (i.e. no negative self-talk). I know that my girls pick up on 100% of my not-so-great behaviors, so I am convinced that they are also modeling 100% of my awesomeness as well (LOL)!
Giving allowance (or not) is every parent’s personal choice. And I don’t think there is only ONE right way for it to be done! But I do think that the number one goal of allowance should always be teaching our children how to make wise choices with their money. I’m definitely NOT a biased Certified Financial Planner or anything…….. LOL!
I’d love to hear how you manage allowance in your home! Leave a comment, shoot me an email, or connect with me on social media @dawndahlby to share your thoughts!
Just tidying up a few recordings before we get this show on the road! I'll be focusing each episode on a guest that has worked hard to master their mind+money connection and diving into how they made the shift, how it changed their lives, and how YOU can do the same thing. Stay tuned!
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