subject: Kids Learn Budgeting With Allowance For Kids [print this page] Kids Learn Budgeting With Allowance For Kids
An allowance for kids is a great way to learn about how to budget money. Parents usually take the time to answer questions and talk a bit about how money should be handled, but it is all theoretical without actual money to use that information on. A child will learn through experimenting and experience with their own money.
Knowing how to save money and being responsible with what is spent is a lesson many do not learn until well into adulthood. This is learned from being thrown into the fire of life by their parents and told now it is their turn to take care of their financial needs. Of course this leads to lots of calls for help until they get it.
A small child can learn a little about saving money and spending it. They may not immediately get the value but they do know the difference between having it and not having it and what they can buy with it. The amount of allowance they are given can match their age or the amount typically given during a week.
Chores are done as a part of daily responsibilities in any household. Allowance and chores should be exclusive of each other. Children will want to know how much they get for vacuuming and how much for cleaning their room. Based on these answers they will want to pick and choose what they are willing to do. This means two lessons not learned.
The child and their parents must discuss what the allowance is used to buy. In this way, they will know that if they spend all their money, they cannot come back to their parents and ask for anything that was agreed upon to be paid for with their money. Some guidance will need to be given as far as how much to spend, save or share.
Lessons of how to manage and budget cash are difficult at any age. Some adults work on it for years and still struggle. Allowance for kids will give children a way to make it all habit and make it more likely for them to do what is necessary automatically.
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