Children And Allowance
The concept of giving a child an allowance to help them learn money management skills and discipline is not a new one. An allowance is a pre-determined amount of money paid typically at the beginning of each month. For most families it is subject to the child completing certain household chores and responsibilities. Children can use their money for purchasing the things they want or need. Also, children are taught and encouraged by parents to save a portion of their monthly allotment.
Determining the amount of money each child should be given each month is a source of debate. There are several factors to consider when determining your child’s allowance which are as follows.
The Age Of The Child
Obviously younger children don't need a great deal of money due to the fact that for the most part they only worry about toys and perhaps edible items such as candy. Older children, especially those old enough to drive, have a great deal more expenses than the younger child. Older children may be required to use part of their allowance to pay for gas and maintenance on the vehicle they drive. Also, there are a great deal more expenses related to the different clubs, sports teams, and other extracurricular activities teens are traditionally involved in.
Allowance Is Based On Lifestyle
An allowance for a teen or child will generally be congruent with the overall lifestyle that parents choose for their family. If the family is considered upper or upper-middle class, their lifestyle would differ from families with lower incomes. To be sure, the lifestyle a family chooses to adopt is not always based on an income or social class. Some families decide that they will raise their children in a more conservative lifestyle regardless of what their net worth might be. Each family (parents or guardians) should determine what lifestyle they are going to adopt and then try to reflect that decision on the allowance they provide for their children.
The Harder The Job The More Allowance Earned
Most parents adopt a rule which is the harder the job, the more money there is to be earned. For example, if a child takes an entire Saturday to clean out the garage, they should receive a bit more allowance than if they simply made their bed or cleaned their room. Having an allowance for children is a valuable way to help instruct them on not only how to save their money, but also how to better decide their wants and needs.
Whatever the amount decided for the monthly allowance is, it should be low enough to not enable children to make large purchase for things they want without having to save for at least two or three months. This will help illustrate to them the principle of sacrificing the things they might want right now for the things they want, or perhaps need, the most.
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