How to Decide on an Age Appropriate Allowance

When your child begins to express a desire for his own money, it might be time to introduce an allowance. There is no age when an allowance is necessary, though, generally, a child should begin earning an allowance by the age of 10, according to KidsHealth. By that age, your child will have the understanding and maturity to make responsible spending decisions. Some families begin to give an allowance at the age of 5 or even younger, according to BabyCenter, when a child begins to realize that money can buy the items he wants. Regardless of your child̵7;s age, choosing an appropriate amount is the first step to starting an allowance program in your home.

Instructions

    • 1

      Look at your budget to determine how much ̶0;extra̶1; money there is available to provide your child an allowance. While allowances vary widely based on a number of factors, the general rule is 50 cents to $1 for each year of the child̵7;s age per week, according to Mark Hodowanic, a credit union market manager, in a BabyCenter article.

    • 2

      Consider the items that you will expect your child to buy with his allowance when determining what amount to give him. A good way to do this is to track the amount of money you spend per week on miscellaneous extras for your child like toys and candy, according to pediatrician James Sears.

    • 3

      Determine how often you will pay the allowance. It can be weekly, biweekly or monthly depending on your budget and family financial needs.

    • 4

      Discuss the allowance with your child and explain what you expect your child to spend his allowance on as well as when and how he will receive the allowance.

    • 5

      Decide on whether or not you want to make the allowance chore based or not. There is no right answer when it comes to allowance. While making the allowance based on the completion of certain chores connects money with hard work, it might be best to keep the two items separate to eliminate the expectation of getting paid to do things that are part of helping the family run smoothly, explains Sears.

    • 6

      Teach your child to put part of his allowance away to save for a big toy or other special purchases.

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