Allowance, Chores & Money Management for Kids

by Mandi on January 27, 2012

source: Alan Cleaver

I’ve been blogging in this space — first Organizing Your Way and then Life Your Way — for over three years now, and there are some great posts in the archives that don’t get much attention anymore. This week, I’ll be sharing some of my favorites. Whether you’ve been around since the beginning or are a new reader, I think you’ll enjoy them!

The great debate when it comes to giving kids an allowance is whether or not it should be tied to chores.

There are pros and cons to both viewpoints, but I’ve never understood why it had to be an either/or kind of thing.

First, let’s look at the debate:

On one hand, an allowance offers the incredible opportunity to teach our kids money management skills from an early age that really will serve them for a lifetime.

Proponents of this aspect of the allowance issue stress the importance of giving kids money regularly so that they can learn how to save, give and invest as well as learn to spend responsibly. However, they believe that chores are a family duty and payment should not be tied to the things that kids are expected to do anyway, so the allowance is usually a set amount each week.

On the other hand, in the real world most of us have to work for our income, and parents who hold onto the allowance-tied-to-chores philosophy believe that kids should only be given an allowance if they’re working for it through daily chores. Receiving an allowance each week is not a given if chores aren’t completed as expected.

A Hybrid Approach

I think both sides of the argument have very valid points. I want to teach my kids money management skills and that there are certain jobs you do without pay as a member of our family. On the other hand, I want to help them develop an entrepreneurial spirit and good work ethic.

So how do we strike a balance? Here is our approach:

The girls have the opportunity to earn $3.50 a week ($0.50 a day) through a variety of chores. They only receive payment if they do their jobs without being nagged, and there is no guarantee that they’ll receive any of that money if they don’t complete their chores.

However, they also have chores that they’re expected to do without payment each day simply because they are a member of the family.

And finally, we regularly offer extra jobs to the first taker. Jobs may include playing with the baby while I make dinner, cleaning out the arts & crafts bin, dusting or straightening up after one of their younger sisters. There are not a ton of these opportunities, so they have to carefully decide each time if they want to take on the job or risk missing out on the opportunity to earn extra money until the following week.

The last part is especially important to me because, as I said, helping them develop an entrepreneurial spirit is an important part of my parenting philosophy. I think being a self-starter and working hard to achieve your goals are important character traits whether money is involved or not, and this is one way we demonstrate that.

A Help-Wanted Bulletin Board

One thing I want to do as my girls get older is create a help-wanted bulletin board where my husband and I can post job descriptions and rates that the girls can choose from to earn extra money. I don’t want cajole them into doing these extra things, and I think creating a neutral place for them to browse and choose the ones that appeal to them (and they think are worth the money being offered in exchange for their time and effort) could be a really fun way to practice some of those skills. I also think it could grow over time to a place where they learn about negotiating, applying for jobs and so forth.

My girls are still young, so our philosophy and system may change over time, but it’s working for now!

What is your allowance philosophy? What benefits have you seen from giving an allowance to your kids?

	Mandi Ehman is the blogger behind Life Your Way. She and her husband have four beautiful girls plus one baby boy on the way, and together, they live, work and homeschool on a little slice of heaven in wild, wonderful West Virginia. She loves coffee, chocolate, easy meals, beautiful things and minimalist spaces.

http://goodnessadded.com/ Elizabeth

I love the idea of the help wanted board. What a great way to allow your girls to choose what extra chores they might want to do. My oldest is 2 1/2. At what age do you think kids can start earning money from chores?
- http://lifeyourway.net Mandi @ Life…Your Way
  
  My 3 year old has been earning quarters along with her sisters for a few
  months now, but mostly only because we didn’t want her to feel left out.
  With our oldest, I think we waited until she was 4 or 4.5. You could try a
  sticker chart in the meantime, although we tried a few times and never
  really found a good rhythm for our family until the girls were older.
  
  Hope that helps!
http://mominmanagement.com Daria @MominManagement

I love the help wanted idea! I give my kids $10 a month (they are 8 and 6). They get that regardless of chores. They do have to set the table and get water for dinner (chore without pay). They also put their own clothes away, feed the dog, and clean their rooms, and pick up the living room when their stuff is everywhere.

We offere $ for extras – but only when they ask. I like the idea of a help wanted A LOT!

Thanks! Daria from Http://mominmanagement.com

I found your site from Many Little Blessings…
- http://lifeyourway.net Mandi @ Life…Your Way
  
  Hey Daria! I’d love to hear how the help wanted board works for your family. It sounds like you already have a system that works for you, and hopefully that can just add another layer to it!
Mary

What great ideas- I love the Help Wanted board. I’ve got, a 4 1/2 (boy), almost 3 (girl), 18 month (boy) and 1 month old (boy), and keep starting and stopping things, I wonder if its just more challenging getting started because my oldest is a boy? Any suggestions? As I would LOVE a bit more help
- http://lifeyourway.net Mandi @ Life…Your Way
  
  Honestly, we started and stopped quite a few times as well. I bet in another year it will be much easier for your two oldest! And I agree, it’s *really* nice now that they can really pitch in. A mom of many told me a while ago that everything gets easier when your oldest hits 6, and so far that’s definitely true for us! I know that’s still a bit away, but it’s coming!
http://www.teamcurtisfamily.com Teamcurtisfamily

The balance is important.

One of the keys that we implemented to offset the costs of being, “part of the family,” is to have them pay a small portion of their weekly earnings to go toward rent, utilities, food, etc. This way they are learning how to handle their money, as well as, pay their cost of living expenses first. We do not have a set amount of money they can earn each week as they are paid per performance. Some weeks there is more work to be done than others.

Also, we believe highly in reading, so our kids are able to earn extra income for reading books of our choice and submitting a book report when completed. (Our older kids that is, 11 & 13) Depending upon the book and their report, they can potentially earn up to $50. (Ex. Rich Dad Poor Dad for Teens, The Seven Habits of Highly Successful Teens, etc.)

A set pay for chores would be comparable to an employee/salary mindset. Pay per performance would definitely be more Entrepreneurial.

Proper handling of money also requires the discipline to pay your Tithe, Taxes, and Cost of living expenses first, then save, invest and/or spend the remaining amount wisely.

Blessings,
Ron
Annie

Great ideas…my husband and I have been talking about allowances for a while and haven’t moved forward with anything because we couldn’t agree on how to do it. I don’t know why it never occurred to us to come up with a “little of both” kind of idea! Duh! lol Thanks for the article!
hollymade

We love pineapple too, and I found a tool made for pineapple. Basically, all you have to do is cut off the top and bottom, and cut the pineapple in half. The tool then cores and takes the skin off in one swipe. Nice!
Candice

Great tutorial! I love pineapple, but I have also been intimidated by cutting it up so I stuck with canned. I can’t wait to use your tips to try a fresh one! Thanks!
- http://yourway.net Mandi @ Life Your Way
  
  Yay, I’m so glad it was helpful for you!
creatingourjoy

Just FYI…cold sores are cause by the herpes virus and have nothing to do with pineapple.
- http://yourway.net Mandi @ Life Your Way
  
  LOL, I actually did know this, but I still can’t bring myself to test her theory. I have read about people developing sores because of an allergic reaction to the pineapple, and I wonder if the urban legend has something to do with that!
http://joyceandnorm.wordpress.com Joyce and Norm

Pineapples from Hawaii are the best. Yum yum yum! Once you have a fresh pineapple, you can’t go back to canned. Hubby usually does the cutting up of the pineapples around here. =)
- http://yourway.net Mandi @ Life Your Way
  
  It’s true that they have a completely different flavor than the canned variety!
Anonymous

We love pineapple. I use to cut them by hand, but a couple years ago I bought a tool for cutting them and haven’t looked back. I did have to cut one by hand at work a couple weeks ago though. I was amazed that no one else at work knew how to cut it.
- http://yourway.net Mandi @ Life Your Way
  
  I think it’s one of those things that if you don’t know, you just never bother to try to figure it out because it seems like it’s going to be hard, LOL!
http://www.athankfullheart.blogspot.com Miranda

Great tip!
http://www.athankfullheart.blogspot.com/ Miranda @ A ThankFULL Heart

I bought a pineapple slicer for $7 at our local grocer store. I cut off both ends and then put onto the top, twist it until it get to the bottom and it has cut off the edges and the core. Here it is: http://www.amazon.com/gp/aw/d/B0000DE4FZ/ref=redir_mdp_mobile/182-9948548-4925640
Christine

Instead of coring it, after I remove the skin I slice straight down, around the core, in 1/2 inch slices. Then I cut those slices into strips for easy eating (or, of course, you can dice it).
- http://yourway.net Mandi @ Life Your Way
  
  I like this idea too, Christine — going to try it next time!
http://www.oahumom.com Lisa

For smaller pineapples I think the cutting tool works well, but the ones I buy are usually big and I find that the pineapple cutting tool I have wastes a lot of the pineapple so I cut them by hand, pretty much the way you described but without an apple corer. If the acidity of pineapples irritates your mouth, try eating them with a little salt sprinkled on them.
mary b

I also cut off the tops and bottom but then I cut it into quarters, lay skin side down and slice the core off the top, skin it, and then slice or chunk it up.
This way I can wrap an unpeeled quarter to save for later if necessary.
- http://yourway.net Mandi @ Life Your Way
  
  This is a great idea, Mary!
Staci Perry @RandomSweets

My kids are 10 and 11 and I think this would work really well. I have always felt kids should learn how to earn and manage money at an early age, yet they should have certain unpaid family responsibilities. I really like your help-wanted bulletin board!!
- http://lifeyourway.net Mandi @ Life…Your Way
  
  Thanks, Staci — definitely come back and let us know how it goes if you try it!
http://livingthebalancedlife.com Bernice Wood

Don’t pull your profits out too soon. Reinvest in your business to insure growth. Plan on 2 years before really being able to draw a salary. Of course, this does depend on the type of business, but the concept of being patient remains for all types of business.
Bernice
Do your actions match your values?
- Anonymous
  
  Good advice, Bernice. Patience is a good virtue.
Tbsvare5

Our method sounds similar to yours. The kids get paid weekly, but it’s based on daily chores. They also have the opportunity to do extra chores to earn more. We’ve tacked on the extra step of accounting for their money. It has to go into jars: tithing, savings, spending….seems to be working pretty well for us.
- http://lifeyourway.net Mandi @ Life Your Way
  
  I love the addition of accounting and budgeting!
Leah

We haven’t implemented anything yet as time quickly slipped away before decisions have been made! We’ve got four kids aged 6, 4, 2 and 5 months. Growing up, we earned half our age in $ per week. Any thoughts on that from anyone?
What are the consequences for not doing the children’s expected chores? I like the hybrid approach but we really struggle to get them to do their chores like packing up. We didn’t want to pay them for this, but nothing else has worked. I’d like to have that sorted out before we implement money (or I really flip out doing all the work)!
- http://lifeyourway.net Mandi @ Life Your Way
  
  Hmm, Leah — those are some good questions. I think maybe you want to start by getting them to do their chores before you even bring money into the mix. We don’t really have set consequences, but I don’t expect my kids to remember their chores on their own either yet. Instead, I’ll remind them to do XYZ when I want them to do it. If they don’t do it, then they don’t do anything (whatever it is we’re doing at the time…eating, playing, watching TV). We also always do chores at the same time, so everybody is working on their job at the same time. I think that cuts down the struggles.
http://www.thenocashallowance.com/ Lynne

In our family we treated money for our kids as as the building blocks for learning money management. The kids needed money in order to practice making money decisions. For that reason I am a strong proponent of paying kids for some chores, but not all of them. Our kids received a small regular weekly allowance that they had to supplement by doing chores. I let them draw job cards that provided instructions and supplies. Some jobs paid, some didn’t. While our kids had to “earn” some of their money, they also had some expenses they had to pay, school supplies is one example. In this way they learned about working and paying expenses.
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KID

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Fool

kid should get money because they take time of for u and do lots of things to help u
- Bum
  
  yo shut up fool
Jennie

Maybe I’m weird, but I always eat the pineapple cores. They’re much chewier, but definitely edible and still taste like pineapple! (and probably super high on fiber, if that’s something you care about…)
- http://lifeyourway.net Mandi @ Life Your Way
  
  I didn’t even know the core was edible!!
The Chatty Housewife

If you don’t have a corer, cut the pineapple in fourths and then you have easy access to cut the core off each section in one big peice. I’d never slice it and then remove each core piece like an apple core!
- http://lifeyourway.net Mandi @ Life Your Way
  
  Hmm, that IS how I core an apple, so I think we’re describing the same thing!
Anonymous

It’s always good to hear about business owners who give back. SCORE is one of my favorite business associations. I’ve written about them a few times. Thanks for the reminder about this helpful resource (http://www.score.org).