Giving Money to Your Children: What to Take Into Account?

If you are thinking about giving your children their allowance, don't miss these points to keep in mind to do it right.

Children know that the world works with money, as they see it every day. They know that money buys things, pays bills, and motivates people. If you want to start giving money to your children in the form of an allowance, there are some things to keep in mind in order to do it right.

If you want to teach children how to manage money well, it’s a good idea for them to understand its value and, above all, to have a good relationship with it so that, in the future, they’ll be able to manage it correctly.

To give money to your children or not

Whether or not to give money to your children can be a big dilemma for parents, and for good reason. Some people think it’s the right thing to do and others think just the opposite. So what should you do? What’s the right thing to do? Is it really beneficial?

When a child starts asking for money, it’s a sign that they know money buys things and that they’re getting older. They begin to be aware that it’s a tool to achieve certain ends.

Some parents give their children a certain amount of money on a weekly or monthly basis. Others only do it to cover the needs that their children have on a daily basis. Either way, if you want to give your children an allowance and you want to teach them its value, you shouldn’t just “give it away”.

This means that they‘ll have to earn it by doing chores that aren’t part of their daily routines. If, for example, your kids don’t usually take out the trash or do the dishes every day, they may have to start doing it to earn that extra pay they want.

It’s important that they’re tasks that they don’t have the responsibility of doing because, otherwise, they’ll get used to doing things for money and, if they don’t get it, they won’t want to do them. And that’s not positive for their development.

Household duties and responsibilities should be separate from pay. It’s a way for children to begin to understand the importance of saving their own money in order to get the things they like and thus learn to prioritize what really matters in spending their money and, therefore, learn to manage expenses. It’s also a way to give them some freedom and control that will help them evolve.

When is the best time to give children their allowance?

There’s no pre-established age, and it depends a lot on the maturity of your child at this time. But from the age of 7 or 8, it’s a good time, as long as your child also assumes responsibilities at home and in their autonomy, such as doing their school homework.

When they’re this young, the amount should be symbolic, just enough for them to feel rewarded when they do things well and feel that somehow they’re getting older and that you trust their abilities.

At first, it’s good to start with a weekly allowance. As they get older, make it biweekly, and when they’re teenagers, it can be monthly. This way, they’ll have the obligation of managing that money so as not to squander it.

Of course, as they get older, their responsibilities should also be greater. This way, you will also work on their independence and performance. Likewise, it’s absolutely necessary to closely observe the behavior they have with money and make the necessary adjustments whenever appropriate.

Weekly pay guidance according to age

Depending on their age, you can find some guidance with the following amounts that you can give them weekly, as long as they fulfill their responsibilities:

• 7 to 8 years old: 2 dollars
• 8 to 10 years old: 3 dollars
• 10 to 12 years old: 4 dollars
• 12 to 14 years old: 5 to 8 dollars
• 14 to 16 years old: 10 dollars
• 16 to 18 years old: 20 dollars

This way, children will learn to value things and everything that has to do with money. It’s a good idea for them to have a piggy bank to learn this management. If you think that they have difficulties managing it correctly, you’ll have to lovingly guide them to do things well.

Tips you should keep in mind if you want to give money to your children

There are some tips that are a good idea to keep in mind so that your children learn the importance of money without wanting you to give them everything they ask for.

• Never give money to your children before the age of 7.
• Talk to your children and agree on a fair amount.
• It’s better to give less than more. If they buy things and run out of money, don’t advance them more until payday.
• Give pay only once a week, every two weeks, or once a month, depending on their age.
• Pay should never be given in exchange for nothing. The extra responsibilities will be those that make them receive pay or not. They have to fulfill their obligations first.
• Allowance can be withdrawn as a consequence of misbehavior.
• Pay should help them save a little.
• Don’t bargain. Nor should you delay paying them if they do things right and, of course, as we said above, don’t advance payments either.
• Money should be given in hand (cash, not using bank accounts).
• You have to respect the way they want to spend it (whether it’s on knick-knacks or stickers).
• You can give them extra as long as they do extra things in their assigned responsibilities.
• The allowance will increase with the age of the child and the responsibilities they take on.

Once you know all this, it’ll be easier for you to know how to give an allowance to your children and for them to learn how to manage it correctly. You’re their guide on the road to understanding the value of money and having a healthy relationship with this important tool in today’s society.