Trust me, I know what I’m talking about.
I am about to offer up some advice on giving allowance to kids. Having raised two earning, saving, and yet generous and practical young people, I consider myself something of an authority. I’ve seen the situation go bad and I’ve experienced the pitfalls.
I think I have some solid advice to offer. Judge for yourself.
The traditional options
Most allowance advocates will suggest one of three options – this Forbes article breaks it down.
Chore-based:
Payment is based on chores completed. Chores are worth a certain amount and whether the child completes the chores, and how many chores he completes, is at his discretion.
Upside – The parent is teaching that money is earned through work.
Downside – The parent is teaching that work is optional.
Pitfall – Don’t even try to ask them to do something for free. You probably won’t be able to get them to do anything unless they choose to. Introducing consequences for not doing a chore is confusing and inconsistent with the policy.
Pure:
Payment is unearned and a benefit of being part of the family. Chores are a consequence of being part of the family. Allowance money is not connected to chores.
Upside – The child can learn about financial planning and budgeting.
Downside – The child will not link money and work, potentially creating a sense of financial entitlement.
Pitfall – With this approach, you cannot use a loss or reduction in allowance as a consequence of not completing a chore. If you link the money to the work, they will too. See Pitfall for chore-based allowance. Therefore, you are truly creating an entitlement scenario.
Hybrid:
Simply put, this is a mix of the first two options. A child has a base allowance, unrelated to work, and household chores unrelated to allowance. Beyond that, they can choose to do additional chores for additional income.
Best of both worlds? Sure. You have a child who contributes through chores without expectation of pay, while also linking extra money to extra work.
Worst of both worlds? Absolutely. You have a child who is entitled to money just for being awesome, while also being entitled to extra money if they choose to do extra work. You are on the hook to provide the extra work if they want it. This will usually come with extra work or money on your part. (e.g., you can wash the car, let me show you how to get started).
Do you get to do that?
Hey boss, I need some extra money for my vacation, will you come up with a special project for me? For a bonus, of course.
Or how about this one:
The inlaws are coming for a visit, we should do some extra cleaning this weekend. Somebody give me some extra money for this!
No. You don’t get to do that. I believe in an allowance plan for the kids that simulates an adult scenario as much as possible. Why should they have it easier than me? How is that teaching them?
Grab a paddle, kiddo, we are in the same boat.
I like all forms of the aforementioned allowance plans up to a point. There is one aspect that I believe they all get wrong.
Most advice on allowance strongly suggests consistency. Be consistent with the amount and with the expected chores. I think this is wrong. I think inconsistency is key. Why? Because it’s real.
You, the parent, do not get consistency at home. Your chores vary depending on whether the dog is sick or if it’s your turn to host Game Night. Your spending money varies depending on whether the car needs tires or one of the kids needs glasses.
Your job may be fairly consistent in responsibilities and income. Allowance gurus want you to teach your kids about having a job – doing work for pay. I think allowance should teach kids about household economics. I think that’s enough.
Here are the tenets of my advice on allowance for kids. It contains much of the advice from previously mentioned plans but with one big distinction. Inconsistency.
The Reality Plan
Kids are not paid for household chores. Kids do chores because they are contributing members of the household.
As contributing members of the household, kids are entitled to a portion of the household spending money. Just like the parents and any other contributor.
While there are basic daily and weekly chores that rarely change, the number of chores that need doing vary from week to week.
While there is a roughly consistent amount of spending money, and therefore a roughly consistent weekly allowance payout, it does vary according to household needs and external factors.
Sometimes, there are many chores to be done but not much extra money, like around the holidays. Sometimes the opposite is true.
Extra money can be earned when extra chores need to be done, AND there is extra spending money to share. An example might be holding a garage sale or washing the car by hand rather than taking it to the carwash.
Additional notes
Some will argue that inconsistency makes it difficult for a kid to plan and budget. I agree. I have that trouble, too. When I am saving for something for myself, it never seems to go exactly as planned.
Hold age-appropriate household spending money discussions with kids being part of decision-making. (If we decide to buy a Playstation, we will have less money for allowance).
Make chores and allowance intentionally inconsistent. Not wildly, mind you. But drive the point home by sometimes having fewer chores and more allowance than usual. Sometimes the opposite.
Be honest and economically-minded. Explain why there is more that needs to be done or less cash to go around.
Caveat – Household economics are open for discussion and explanation, but it is not a democracy. Kids get a vote when you say they get a vote. They are exposed to the information and details you choose to share.
The benefit of The Reality Plan is that kids are exposed to a realistic simulation of household economics. The degree of reality is up to you, the parent.
Some tips and tricks
The volunteer wins
This works well with more than one chore-aged kid. At random, ask for a volunteer to do some small chore, like taking out the trash. The kid(s) that did not volunteer is assigned – on a voluntold basis – a more undesirable task, like the dishes.
Do not explain it, they will catch on quickly. It won’t take long before they figure out the volunteer chore is going to be the easy one. Before you know it, every time you say you need something done, they will jump at the chance to volunteer.
Zero tolerance allowance
Every kid will do it once – be prepared. It is an important lesson to teach and it is fast-learned.
When you decide that allowance this week is, unfortunately, less than they may expect, there will be a balk or a complaint.
That is it. You immediately take it back. You don’t like it? Huh. I like it. I guess I’ll keep it.
There is no turning back at that point. They cannot apologize or beg. They had one chance to get what you had to offer.
They will all do it once. If you exhibit absolute zero tolerance, it will never happen again. From that point on, they will accept what they are given.
The conscientious contributor
For older kids, I like to provide freedom and choices in terms of contribution.
Leave a list of chores you would like done and ask them to choose from the list. Maybe there is a list of six chores with a note asking them to do at least two before 5:00 pm. Maybe there is a list of 10 asking for at least 4. That is up to you. But be sure to use the words “at least”.
Kids, like all people, will tend to serve their self-interest by choosing the minimum and the easiest or least time-consuming. That is fine. But those times that they do more than the minimum is when your heart skips a beat and you know you are winning at parenting.
Final words
Raising kids is hard, and you never know when you might be doing more harm than good. Allowance decisions are no different.
The concept of earning money for work is valuable, but it’s simple. Kids spend a lot of time thinking about their future jobs, what they will be when they grow up, and they understand that they will earn a living through a career.
Allowance isn’t necessary to teach this, and tying money directly to household chores, in my view, does more harm than good.
One of the main goals of parenthood is to produce a contributing adult. This is the challenge.
In the real world, sometimes contributions are paid in cash, sometimes they are paid in satisfaction, sometimes they take more than they give. These are the hard lessons. These are the lessons that need learning.
Allowance is an opportunity for kids to learn how to be part of a family, a household, a society. You don’t always get what you want. You don’t always get what you expect.
Teach them that. Be inconsistent.