The Piggy Bank: But How Much?
Can you get into this allowance kick that I’ve been on lately?! I would love to hear how the allowance structure works in your family and if you have any tips that you are willing to share! We’ve been talking a lot about do’s and don’ts of an allowance but one thing we haven’t discussed is how much is a good amount for our kids. Of course, this will have many factors that affect it—the age of your child, your financial situation—you get it. Certainly, you don’t want to stretch yourself farther than you can afford.
If you are wanting to give your child a weekly allowance, it is suggested that the amount is half their age. However, if you are more comfortable with a monthly allowance then twice their age is a good amount for them. So that would look like $5 a week or $20 a month for a 10 year old. As discussed previously, we want to give the kids enough money that they can learn through the real-life experience of spending their own money but not so much that they don’t need to considering budgeting.
Another great suggestion from Jordan, the blogger at FunCheapOrFree, is if you have little ones, consider a group savings jar where their allowance goes into a jar so they can see it add up and work towards funding a fun outing that the kids can look forward to! For example, they are saving up for their trip to Disney (of course the amount in the jar won’t cover it but once they achieve their goal Mom and Dad will cover the rest!) Don’t forget, you can provide your kids options to earn additional money by completing tasks around the home (more than their normal chores) or encouraging their entrepreneur spirit through selling goodies/lemonade, washing cars, etc.…
Like I said, I’d love to hear any feedback you have on the allowance structure suggested and/or your experience with allowances in your family! Let’s work together to create a future of self-sufficient and financial savvy young adults!