Creating a Plan for Your Children’s Allowance

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As you get ready to start a new year, you may want to adjust the way that you help your children understand budgeting and money. A recent survey shows that children bring in an average of $15 a week for allowance. About 61% of parents say that they pay their children allowance and the average age that children start receiving allowance is eight. As children age, it is common that their allowance increases.

Interestingly, the money that parents are giving their children is not being saved. Rather than saving the money, children often spend the money quickly. Children often do not understand the principles or the importance of saving and it is up to parents to talk help children understand personal finance.

An allowance can provide parents with a great opportunity for teaching children about personal finance. Determining a specific percentage of money that can be set aside each week for long term and short term savings can be very effective budgeting practice.

Some parents find success in offering to match long term savings. If your child is saving for a car or for college, offer to match their savings at the time that they purchase a car or leave for school. This can be a great motivating factor throughout the time that they are saving. Helping your child understand how to handle money at an early age can prepare them to leave the nest and be self-sufficient after moving out.

Help your children incorporate good spending and saving habits with their allowance. Develop a system that works well for children and in your home. The new year can be a perfect time to develop a new system!


Q: How much allowance do children typically receive, and at what age do they start?

A: On average, children receive about $15 a week for allowance, and they often start receiving allowance at the age of eight. However, the amount and age can vary among families.

Q: Why is it important for parents to teach children about budgeting and money management through their allowance?

A: Teaching children about budgeting and money management at an early age is crucial because it helps them develop good financial habits, understand the importance of saving, and be prepared for financial responsibilities as they grow.

Q: What strategies can parents use to help children incorporate good spending and saving habits with their allowance?

A: Parents can develop a system that works well for their children and home, such as setting aside a specific percentage of allowance for long-term and short-term savings and offering to match long-term savings for significant goals like a car or college.

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