Allowance :: A Great Teaching Tool
When my daughter was around the age of 13, I started considering the idea of giving her an allowance. It wasn’t really so much that she needed the money, but more that I wanted to teach her a little about the value of money, and how to manage and make choices with it. Additionally, I wanted to reward her for taking care of all of the things around the house that she was responsible for.
I took her to the bank and opened an account for her, and when she got that little debit card, boy was she excited! Later on that week, we went to the grocery store. She was eying a pack of gourmet cookies, somewhere around $6-$7 a bag. She asked if she could get them, and I smiled at her and told her, “Of course you can … with your allowance.” She looked at me, stunned, horrified even, then put the cookies swiftly back on the shelf, exclaiming she wasn’t spending $7 on cookies. And that was her first lesson in learning to weigh whether something she wanted was really worth the money (to her). It also taught her to be more appreciative when someone was spending their money on something for her, and to be more thoughtful and conscious of things she asked for.
After about 6 months or so, I gave her a $5 increase in her allowance (she started at $15, for reference). I decided at that point that from then going forward, she would be responsible for taking care of her own toiletries (think shaving cream, razors, makeup, hair products, etc.). There were many reasons I chose to do this. One was to teach her to be more conscious of how much she was using. I don’t know about you ladies, but I’ve noticed kids have a tendency to over-pour, over-squeeze, and just use more than they need to of a lot of things. I thought that, perhaps, she would use a little more discretion about her consumption if it was something she had to replace herself. I also wanted her to learn how to make responsible decisions with her money, in a similar way adults do with their paychecks. This allowance was her paycheck, so she would be learning to take care of her needs first, and then she could take care of her wants. If she made poor choices and didn’t have the money she needed when it came time to buy her necessities, she wouldn’t be able to afford them (of course, if she needed something, I would buy it … buuuuuuuut she would have to pay me back out of her next deposit, and it wasn’t something I’d be making a habit of, lol).
We’ve been doing this for about 4 years now. She will be 17 in the fall, and still gets her weekly allowance (which is capped at $50, lol). I can honestly say it has made a big impact on the way she views finances. She is still responsible for all of her own things, which have been expanded to include purchasing all of her own clothes and paying for gifts for her friends for holidays / birthdays, etc. She has become wonderful at saving money – the days of her having to wait until “payday” are over, lol, and she is never short on funds. When I take her to Ulta, I’ll watch her compare products and pricing, then tell me how she’s not buying this or that because it costs more than she wants to spend. When she finds something a little costly that she wants but isn’t sure is worth it, she’ll ask for some guidance and discuss it with me, but ultimately, I always tell her it’s her decision, and there are many times she will decide that it’s something she doesn’t really need, or doesn’t want enough to pay for.
The lessons she’s learned from this aren’t limited to her just managing her own money. Because she knows its value, and knows that making money takes time and work (because her allowance, like I mentioned, is contingent upon her keeping up with her responsibilities at home, and as her age/allowance have increased, so have those responsibilities), she has a more significant appreciation for what she has and receives, takes more pride in her things, and displays more respect towards both her own possessions, and the possessions of others.
If you’re on the fence about allowance and the potential benefits, hopefully our experience will provide a little insight. I can truly say that for my daughter, it was one of the best decisions I could have made.
