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Allowance and Kids

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The Top 3 Questions that Parents ask about Kids and Allowance

Parents have 3 main kids allowance questions.  (see Questions & Answers below)  But, what parents REALLY want to know is, "Will an allowance teach my kids about respecting how money works (that is, "money makes more money"), so that my kids will use (save, spend, donate) money wisely?" 

YES!  An allowance can help kids learn everything there is to know about money WHEN allowance is only a part of the teaching.

This lens answers your basic kids allowance questions - and your more complex concerns about kids and money.  You'll be ready to make decisions about what to do next to teach your kids great financial wealth habits.

I am the author of The Kids' Bank Book, which goes well beyond allowance, and the Squidoo lens, How to Teach Wealth Habits to Your Kids.  (I wholeheartedly recommend that you first get more info about allowance basics on this lens, and get the free "5 Tips" email, and then, later, take action and use my Kids' Bank Book system to teach wealth habits to your kids.)

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TOP 3 Allowance Questions & Answers

Which one brought you here? Just click on the arrow to rank your most pressing question - we want to know! Different questions brought you here? Tell me by Submitting a Blurb at the bottom of the page and I'll do my best to answer it - maybe I'll even add it to this list!

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Should I give my kids an allowance?

YES. Why? Lots of reasons. If you start while your kids are young (less than 8 or 10), the allowance money will provide the money for them to use a money management system that you set up. Second, it breeds trust and responsibility. Third, it allows your child to develop wealth habits without complicating it by the whole teenage-work thing. But, never tie punishments to allowance.1 point

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Should I give my kids an allowance in exchange for chores?

NO. Now, some say that this teaches kids that money comes from hard work blah blah blah - but it doesn't. And, anyway, do we want our kids to be hard working factory workers when they grow up - or - to be indepently wealthy joyful contributers to our society using their best talents, and work smart? [A: The latter.] So, HAVE CHORES. Everyone in a family needs to care for the home - and be rewarded by personal satisfaction of being part of a great team. It fosters the teamwork habit.1 point

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How much money should I give for allowance?

The amount is not as important as deciding what your child is going to do with it. 20 cents or $20 works just as well. The main thing a child needs to do with allowance is to use it in a SYSTEM that you give your child for money management. (see more below - the 25% to each bank system) [Note that if you give your child a hefty allowance, then he/she might also now be responsible for buying his/her movie ticket. But, it will be sure failure if you do it on a haphazard case by case basis.]0 points

4-part and 3-part Kids Banks

... to hold the allowance ... and all the other money too!
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Show Your Kids This:

WATOTO

Then watch the
Attitude of Gratitude
begin . . .

The Key to Wealthy Kids Requires More than Just an Allowance (or a Job)

Allowance is just the first step. Allowance alone - or, kids getting "a job" along - doesn't teach money management.
  1. Approximately 2 middle, upper middle, and upper class generations have grown up with allowances - and they're accumulating as much, if not more, consumer debt as their parents did.
  2. When dealing with kids and money, without a clear, concise system, we rely on mantras about "saving pennies for a rainy day," lectures ("what did you spend all of your money on?"), or in-store battles ("why don't you use your own money for this?" "because I was saving it for a new bike, not this small toy that I want"). Chaos and confrontations rule the day.
  3. When you combine that lack of system with a probably already financially-stressed-out parent, it spells disaster. Most parents want to have more financial abundance than they now have. Some of those are dedicated to an adult system to achieve their financial independence goals. But few of those are prepared to translate that adult system into a system that kids can use - or, rather, WANT to use.
  4. So, you need (a) a system that dictates what kids will do with their money, that also empowers them to make some of their own money decisions (it sounds contradictory now, but it really isn't), and (b) a way to educate your kids about that system (oh, and have your kids EMBRACE it).
  5. The kids' money management system (or what I call a "wealthy habits system") should teach your kids how money works, which needs to include:

    What ROI is
    What compound interest is
    Investing money
    Saving money
    Spending money
    Donating money

Do you give your kids an allowance?

I want to know what lens viewers to so that I can give you the best info possible about allowance.

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Kids & Money - Teaching Wealth Habits to Your Children

Have you realized that you'd like to spare your children the burden of repeating your money mistakes? (or, of the poor money lessons that you were taught as a child?) Do you want your kids to learn NOW - while they're young - the money wisdom and skills that you are acquiring on the "Get Out of Debt Now" or "Law of Attraction" paths that you are (fortunately) now on?

Would you like your kids to learn Abundance and Wise Money Management now, when they're young? Would you like your kids to build strong habits that will help them save, spend and donate money wisely?

Go To The Kids' Bank Book Now to get the e-book

Want to Learn More about Kids and Money?

Get lots more info @ my Squidoo lens about Kids & Money and The Kids' Bank Book
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Best "How Money Works" and "How to Build Wealth" Book

All in One

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Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money--That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money--That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

You can't teach your children about how money is used to build wealth, if you haven't yet mastered the info yourself. Get it in book or on CD - but get it! Postpone the allowance and take a "personal" day from work to invest the time that will make it all worthwhile.0 points

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Rich Dad Poor Dad: What the Rich Teach Their Kids about Money¿that the Poor and the Middle Class Do Not! by Robert T. Kiyosaki, Sharon L. Lechter

Rich Dad Poor Dad: What the Rich Teach Their Kids about Money¿that the Poor and the Middle Class Do Not! by Robert T. Kiyosaki, Sharon L. Lechter

The Rich Dad, Poor Dad book - but on CD - so you can save time and listen while you're driving in the car - with or without the kids!

Wherein you'll learn that a good education and a secure job are not guarantees for financial success, and describes guidelines for making money work for you.0 points

Best Adult Wealth Systems

Including tips on Parenting Your Children about Money

If you weren't a semi-financially-stressed-out parent who was trying to give your kids a better financial start so that they wouldn't struggle like you are when they got to be your age, you probably wouldn't be here. A few financially independent parents visit here because they want to pass along the wealth in the best way possible, but they're not my average lens viewer.

So, here are the best resources for you to get your own system. The Commitment to the System is within you!

Have a favorite? Vote it to the TOP. Have a favorite that is not shown? Add it to the list and I'll review it!

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Rich Dad - Games

You MUST play and master Cash Flow 101 if you are not yet financially independent. [It includes 3 CDs about CashFlow101 lessons.]1 point

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Rich Dad Forums

Staying connected to others on the same path is crucial to your success! Rich Dad Forums cover lots of beginner and advanced investing questions, Cash Flow and Kiyosaki book questions, and parenting questions!0 points

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Crown Financial

Crown Financial has done an excellent job at putting together various tools for a great adult system - software, online tools, books - that is similar to the "wealthy habits" system that I recommend for kids. Very positive and supportive.0 points

Kids' System for Wealthy Habits

The System in my Kids' Bank Book (www.kidsbankbook.com) is a 25% More Money (investing), 25% Spending, 25% Christmas/Gift Savings (to buy gifts for others), 25% Donations system. Here is a list of the topics that I cover in The Kids' Bank Book (it has 2 parts - The Theory and The How To). Vote your most important, most relevant topic up or down.

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Parts to, and Building, The Kids' Bank

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Funding the Kids' Bank

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Funding the Bank of Parents

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About Allowance

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Determining Allowance Amounts

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What Does ROI mean?

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Determining the ROI of the Kids' More Money Bank

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6 Chapters on How To Teach Money without Really Teaching

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Tips on Making a Kids Bank

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Resources Section

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Teamwork Section

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Excel Spreadsheets for ROI Calculations and Suggestions

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Money Talk

This online community brings together Filipinos from more...0 points

MORE Information about The Kids' Bank Book

Use these links to take you directly to specific pages to get more information about The Kids' Bank Book.
Kids' Bank Book's FAQ
FAQ about allowance, about using The Kids' Bank Book, about kids and real life investments. You can e-mail your own questions and have them answered.
Kids' Bank Book - What You Wish Your Parents Had Taught You
Alot of us were taught, intentionally or unwittingly (by parents who I am sure were teaching their best wisdom at the time), very negative and self-destructive concepts about money, saving it, using it, and growing it. Here's a brief discussion of positive, productive, wealth-oriented thinking that we wish we were taught - and that we want to pass along to our children. The Kids' Bank Book is oriented and geared toward this positive thinking.
Kids' Bank Book - Part 2 to the Above Discussion
This is a more extensive discussion about different money beliefs, how they can be positive or debilitating - so you can better understand and evaluate how you got here and where you are going - and where you want your children to go - and how you are going to get them there.

Donating or Tithing

Answer the poll, and tell me by Submit a Blurb (at the bottom of this lens), why or why not - and if so, who their favorite charitable organization is.

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Your Favorite Wealth Resources

With a few from me

Are you a homeschooler? Are you an avid wealth blogger or blog reader? Are you a member of a web group that focuses on parenting or money? Give us your best advice about the most current web wealth resources - just click on Add Link - I'll review and be happy to add it if it's quality. And, as always, vote your favorites to the top of the list (by clicking the little left-hand-side arrows)!

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Kids Roar

Kids, age 8 to 12, living the wealth habits system! Go kids! Want your kids to be this enterprising? Get your system in place, and then get your kids' system in place. Step back, and watch your kids go!0 points

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Teaching kids financial literacy

Making decisions about money can be difficult and many of us have no confidence in our financial skills. Here are a few facts that re-iterate the importance of Financial Literacy and emphasize the importance of teaching them to our kids (these are biased towards Canadians but you can find similar tr...0 points

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Money Sense for Kids

Money is something that isn't usually openly discussed in families. However, talking about money can help your child develop important life skills around money management and a postive attitude towards personal finance. We all want the best for our kids. So help make money visible and a source of jo...0 points

Why No Link to a Kids' Bank?

You won't find any link on this lens to a kids' bank because I don't like any of the kids' banks on the market. None of them take care of money in a way that is conducive to treating kids about money.

Piggy banks don't work for tons of reasons. Learn about many reasons why piggy banks don't work - and in fact, why they are destructive to learning wealthy habits at "How to Teach Wealth Habits to Your Kids", at

How to Teach Wealth Habits to Your Kids

Then there is the case of the very few 3-part or 4-part banks that are on the market. These kids' banks attempt to cooperate with a 1/4, 1/4, 1/4, 1/4 money management system like I discussed above, or with a 1/3, 1/3, 1/3 system (investing, spending, donating). But, none of them are constructed in a way that addresses the evils of the piggy bank. (again, see the squidoo.com/kidsandmoney lens)

So, I advocate making your own 4 part bank that does everything that a piggy bank doesn't - allows easy access (in and out) for the money, keeps paper dollar bills neat, etc.

Get the Basic Instructions of
"How to Make a Giving Bank that Works" at
How to Build a 4 part Kids' Abundance Bank

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Squidoo is a great place to get easy-to-read, friendly answers, and lists of Web resources on your favorite parenting topics. Each and every lens listed has been personally checked out and approved by me. Feel free to vote your favorite Squidoo lens up (or down).

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Reader Feedback

Like this lens? Want to give feedback or just a thumbs up? Want to give additional comments about your poll answers or rankings or contributions above? Do it here! [Also, look here for my various comments about kids' money and allowance.]

  • Sylvestermouse Apr 12, 2011 @ 3:46 pm | delete
    This is a very interesting subject Both of our children are grown now, but I very much remember the question of allowance. I have always believed that everyone should have a little "spending money," as my grandmother would call it, but interestingly enough our children rarely spent their money. The both liked watching their bank accounts grow :) Ummm, they still do. Thus far, they have not lived beyond their means and they continue to save. I do believe it is about teaching combined with allowance, not just handing a child money. Just my opinion :)
  • kitty222 Apr 7, 2011 @ 6:53 pm | delete
    This is very good advice for parents who want to teach their kids about money. I might add that, if you're going to give your children an allowance, you should have a specified day each week to give it to them. Like, say, Saturday. And stick to it so they know when they're getting their money. And don't forget!
  • wordstock Mar 17, 2011 @ 5:08 pm | delete
    Wonderful lens that has confirmed my thoughts on allowance. We are in the process of reworking what we did previously and this is very helpful. Angel blessed.
  • lindarandall Feb 8, 2011 @ 7:05 am | delete
    awesome lens and ideas here, adding yours to my blog roll for business ideas for kids, i follow back on twitter - the idea girl
  • kidswealth Aug 11, 2008 @ 2:46 pm | delete
    After reading your lens (and giving you 5 stars) it seems we agree on many points when it comes to teaching kids about money. I also believe that an allowance is key to teaching kids about money, and that Piggy Banks are terrible. Check out my lenses when you have a moment. http://www.squidoo.com/lensmasters/kidswealth
  • anilg Jun 26, 2008 @ 6:39 am | delete
    Nice lens with lots of useful information. If you are willing to make money online, then please visit my lens
  • TheresaMarkham Apr 9, 2007 @ 12:16 pm | delete
    When was the last time you laughed with your kids? If not today, try tonight at dinner or watching a movie or driving in the car. Laughing together builds trust. Trust builds easier money talk. Kids' Bank Book
  • TheresaMarkham Apr 6, 2007 @ 7:18 pm | delete
    Using a 3-part bank (sometimes called a Giving Bank)? Ever try to divide a dollar evenly by 3? Ever try explaining why one bank is going to get more when you've just convinced the kids of the importance of making it even? Spare yourself the headache. Get wisdom with The Kids' Bank Book.
  • TheresaMarkham Apr 4, 2007 @ 1:39 pm | delete
    Want to have a fun time with your kids? Play CashFlow 101 with them (about age 10 ). Don't try to teach them - just have fun
  • TheresaMarkham Apr 3, 2007 @ 10:26 pm | delete
    Have a specific question about Allowance? Email me - click on CONTACT ME just below my Bio in the top right corner. Isn't Squidoo great that you can get to see such a personal side of me instead of some brightly-highlighted-big-bold-lettered-sales-page? Wishing you All the Best, Theresa
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Cool Squidoo Lenses for Parents (and Kids)

If you have a daughter, it's inevitable - and fun!
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My Current Favovrite Quote

Do What You Can,
Where You Are,
With What You Have!

- Teddy Roosevelt

Here's What To Do Next:

note: write this down :)

  1. Go to Kids' Bank Book
  2. Click on the Get The Kids' Bank Book Now link just below the happy family picture
  3. Read Kids' Bank Book, which you just received instantly online (after your $27 investment)
  4. Chuckle, smile, think, say aha!, say oh now I get it! (while reading it)
  5. Watch your children Thrive with their new-found financial Wisdom
  6. Joyously listen as your children boast of their new financial skills to other friends and family members
  7. Celebrate! A financially wise generation is born!
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by

TheresaMarkham

Theresa A. Markham, Esq. is a divorce lawyer, and loves living in scenic Northwest New Jersey with her husband, Chuck, and daughter Zoe, and is visited... more »

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