How we do allowances
Teaching kids how to handle money isn’t the easiest thing in the world. Several people have noticed our “system” and asked that we pass along what we’re doing. Basically, if our kids (5 & 7 yrs old) make their beds, clean their rooms, and help with random household chores they get a daily “check” on their allowance poster. Each “check” is worth 25 cents. So if a toy costs $10, then it will take them 44 days of chores to save up for that goal (10% goes towards tithing). It’s not that complicated, but it’s helped us teach them some important lessons.
The rhythm of responsibility
Being responsible is a habit…not an occasional activity. We want our kids to learn that doing their chores is a daily responsibility, not just when it gets “to bad to bear.” Every day I inspect the kid’s rooms to see if they’ve been responsible. If they’ve done all their chores, they get a check (it’s an all or nothing thing), if they haven’t, “no check for you.” At this stage instant feedback is critical to grafting in the value of responsibility.
A specific aim
We have our kids save for a specific item that they pick out. To remember the goal we take a picture of it and place it on their allowance poster as a reminder of what they are saving for. Being specific brings focus and ties their responsible behavior with something they want.
An achievable goal
We only have our kids save their money for items that are $15 or less. Any more than that and achieving the goal becomes to distant and momentum dies off. The lesson for our kids is to delay gratification long enough to learn the value of patience. We don’t want them to give up.
We don’t let our kids “borrow” money from us to purchase something. If they want it, they have to save their money for it. There are times we have purchased the toy while the store has it in stock, but we don’t let our kids have access to it until they’ve reached their goal.
What we’ve learned is that our kids deeply treasure the toys that they have purchased, think through the goals they have set up, and understand the value of being consistent. You’ll often hear my kids ask, “How many days does that cost?” They’re learning that time and money go hand in hand. Obviously this approach will only work for a certain ages. In the future we’ll need to transition to “real money” goals and show them how to save create a savings.
Here is a Word doc that you can use as a template. Feel free to use it and let us know how you make it better.