I was having coffee with a friend recently who has three beautiful daughters age 6 and under. She asked me when I began giving my soon-to-be 11 year old daughter Rachel an allowance.
Now, there are many philosophies on the subject, and sharing my own is not meant to be prescriptive. I do find, however, that people tend to be interested in my personal money decisions given that I give so many people financial advice. (yes, I practice what I preach!).
My daughter started getting a weekly allowance about 3 months ago. Here is how it happened:
I was preparing dinner after work and she was doing her homework at the kitchen table. Out of the blue she said, “Mom, when can I get an allowance?”
Me: “Why do you ask?”
Daughter: “Well, my friends get an allowance.” (bad answer)
Me: “What would you spend an allowance on?”
Daughter: “hmmmm, well, birthday presents and mother’s day and father’s day presents. Stuff like that. (good answer!) And I will do chores around the house.”
Me: Rachel, your responsibilities at home are yours whether or not you get an allowance. Everyone in the family pitches in, even though we don’t get paid for it. That will not change. Dad and I will discuss this and let you know.
We did discuss it, and neither of us have anything against giving Rachel an allowance. She has learned the value of money over the years and when she has received gifts in the form of cash, she hands over most of it for her savings account. So, having a little spending money for presents etc. will get her used to making buying decisions.
We surveyed a number of parents and found out that the going rate within her group of friends is $5. Wow, when I was a kid it was 50 cents! But back then, I could buy two chocolate bars for 50 cents.
So, how is it going? Pretty well I think. She has made a couple of purchases, but has also been saving. Just this weekend she mentioned that she is saving up for a laptop. Good thing they get less expensive every day!!!
Feel free to share your allowance stories. I’d love to hear them!
Rona Birenbaum is a certified Financial Planner and is licensed to do financial planning. Rona is registered through separate organizations for each purpose and as such, you may be dealing with more than one entity depending on the products purchased. Rona is registered through Caring-for-Clients for financial planning services. This website is not meant as a solicitation for financial advisory services. Financial advisory services are available through the facilities of Queensbury Strategies Inc. Financial Planning is not the business of or under the supervision of Queensbury Strategies Inc. and Queensbury will not be liable or responsible for such activities.