Friday, August 20, 2010
In our household, we don’t pay a regular allowance because we feel that all family members should be able and willing to pitch in for the good of the family. So we don’t pay, for example, when the kids clear the dishes from the table, clean up their rooms, etc. Those are just normal day-to-day things that everyone should be doing. However, we will pay for “extra” jobs, such as pulling weeds in the yard or detailing the car.
Some parents feel that kids deserve a regular allowance to help them learn how to manage a budget, and I understand that, too. If kids receive a little cash on a regular basis, they can learn the value of saving for a big-ticket item or figure out ways to get their money to grow. These are all valuable lessons.
So, if you decide to give your child an allowance, here’s one way in which you can find out how much you should be paying. ThreeJars.com recently introduced the Allowance Calculator, a free online tool that quickly helps parents determine the right amount. One indicator is the suggestion that parents pay ½ their child’s age in dollars per week. They also inflation adjust the parent’s childhood allowance (if one was received) to the age of their child in today’s dollars. It’s quick and fun!
Here’s a copy of the form you fill out:
And here’s an example of what it will tell you:
If you’re stumped about how much allowance to give your child or just want to see how your current system compares to an expert recommendation, go to www.threejars.com and click on their Allowance Calculator.