My Boys and Allowances

I have never paid an allowance.  I have never agreed with paying children to do their part in a household.  Parents unselfishly drive, grocery shop, wash, ect. Once a child is on their own no one is going to pay them to do what is right.  No one is going to pay them to clean up after themselves.money puzzle

It’s my personal belief that paying an allowance teaches an attitude of self entitlement.  Not paying for some of the extras help the kid figure out what he/she is going to do about it.  Want that bike….go mow lawns….need more air-soft pellets, go stack wood for the neighbor.

I found this article that also explains it perfectly:

Most commonly, a family is an interdependent group of people living together in a love relationship.  Members of the family depend on each other and work together for the benefit of the unit as a whole.  They share most everything and do not benefit by keeping separate accounts of “yours and mine.”  Just as parents make dinner, wash dishes, clean the home, and offer transportation without expectation of allowance… children should be trained to contribute in much the same way.

By paying children for daily chores we are actually robbing them of their opportunity to contribute based on love, and instead teaching them that they should be paid for their contribution to the family.

So what about reward for excellent behavior?  Rewards should be given for going above and beyond the normal call of duty – thus earning a bonus – but not for performing everyday tasks.

You get paid for a job, and your home comes with responsibilities that you do not get paid for, yet there is a satisfaction for being responsible.  Lets teach that lesson, not a lesson of self entitlement.

BUT if you are going to pay allowances here is a great suggestion:

A Proper Distribution

Since allowance is a tool used to train the child on the matter of proper money management… what about taxes?  I believe children should have taxes taken out of their allowance in order to paint them a more accurate portrait of how money is handled in “the real world.” Some may find this legalistic, but I’d rather they be as prepared for reality as possible.

Here is a solid outline for proper distribution of their allowance.  Take this and make it your own based on your situation.

  • 15% giving – Based on gross amount… taken before taxes or anything else.
  • 10% to taxes – Just as we have to pay taxes as an adult, we should give the child a similar opportunity… after all the idea is to train them.  Put this amount back into their college savings fund or some other savings account to be used for their future.  It may not seem like a lot, but remember… every penny counts!
  • 25% to savings – What to save for?  This is a very personal matter to be determined by the parents.  If nothing else, simply save it to save it.
  • 25% to bills – This is a very powerful concept, so keep an open mind here!  This money should go back to the parents and gives the children the unique opportunity to contribute to the household bills.  This builds confidence, self-worth, and an unmatchable feeling of usefulness.  This philosophy can also be used to teach them to conserve spending on household utilities, groceries, etc.  As much as possible, try to involve them in the bill paying/grocery shopping process… doing so will give them a “vested interest” in cutting costs.
  • 25% to spending – This can be used as the child desires, but be careful here – proper use of this portion is critical in shaping their future spending habits.  If they want to spend it, they can spend it.  If they want to roll it into their savings, they can do that as well.  If they want to help out with bills, that too should be welcomed!  I think  you will be surprised by how much of it they simply want to give back to you in an effort to further “help out” with the costs of running the home!  Always make yourself available to help them make these decisions.

Give the children all their money up front, so they can see it and physically handle it.  Then help them divvy it up according to the distribution system you set up.  Also, include a statement of distribution so the child can see where all their money goes; just as your employer does with your paycheck.  Do not simply withhold a certain amount, because you want them to be as involved as possible.

 

( I apologize for the lack of reference to the above mentioned article.  I do not have the record as this is from an old post.)

My Boys & Allowances

I have never paid an allowance.  I have never agreed with paying children to do their part in a household.  Parents unselfishly drive, grocery shop, wash, ect. Once a child is on their own no one is going to pay them to do what is right.  No one is going to pay them to clean up after themselves.

It’s my personal belief that paying an allowance teaches an attitude of self entitlement.  Not paying for some of the extras help the kid figure out what he/she is going to do about it.  Want that bike….go mow lawns….need more air-soft pellets, go stack wood for the neighbor.

I found this article that also explains it perfectly:

 Most commonly, a family is an interdependent group of people living together in a love relationship.  Members of the family depend on each other and work together for the benefit of the unit as a whole.  They share most everything and do not benefit by keeping separate accounts of “yours and mine.”  Just as parents make dinner, wash dishes, clean the home, and offer transportation without expectation of allowance… children should be trained to contribute in much the same way.

By paying children for daily chores we are actually robbing them of their opportunity to contribute based on love, and instead teaching them that they should be paid for their contribution to the family.

 So what about reward for excellent behavior?  Rewards should be given for going above and beyond the normal call of duty – thus earning a bonus – but not for performing everyday tasks.

You get paid for a job, and your home comes with responsibilities that you do not get paid for, yet there is a satisfaction for being responsible.  Lets teach that lesson, not a lesson of self entitlement.

BUT if you are going to pay allowances here is a great suggestion:

A Proper Distribution

Since allowance is a tool used to train the child on the matter of proper money management… what about taxes?  I believe children should have taxes taken out of their allowance in order to paint them a more accurate portrait of how money is handled in “the real world.” Some may find this legalistic, but I’d rather they be as prepared for reality as possible.

Here is a solid outline for proper distribution of their allowance.  Take this and make it your own based on your situation.

  • 15% giving – Based on gross amount… taken before taxes or anything else.
  • 10% to taxes – Just as we have to pay taxes as an adult, we should give the child a similar opportunity… after all the idea is to train them.  Put this amount back into their college savings fund or some other savings account to be used for their future.  It may not seem like a lot, but remember… every penny counts!
  • 25% to savings – What to save for?  This is a very personal matter to be determined by the parents.  If nothing else, simply save it to save it.
  • 25% to bills – This is a very powerful concept, so keep an open mind here!  This money should go back to the parents and gives the children the unique opportunity to contribute to the household bills.  This builds confidence, self-worth, and an unmatchable feeling of usefulness.  This philosophy can also be used to teach them to conserve spending on household utilities, groceries, etc.  As much as possible, try to involve them in the bill paying/grocery shopping process… doing so will give them a “vested interest” in cutting costs.
  • 25% to spending – This can be used as the child desires, but be careful here – proper use of this portion is critical in shaping their future spending habits.  If they want to spend it, they can spend it.  If they want to roll it into their savings, they can do that as well.  If they want to help out with bills, that too should be welcomed!  I think  you will be surprised by how much of it they simply want to give back to you in an effort to further “help out” with the costs of running the home!  Always make yourself available to help them make these decisions.

Give the children all their money up front, so they can see it and physically handle it.  Then help them divvy it up according to the distribution system you set up.  Also, include a statement of distribution so the child can see where all their money goes; just as your employer does with your paycheck.  Do not simply withhold a certain amount, because you want them to be as involved as possible.