It’s Money Smart Week which makes it the perfect time to kick off our Junior Money Masters campaign! This campaign starts with focusing on teaching our kids about earning. Once a child knows what it feels like to work for their hard-earned cash, it influences their buying decisions and helps them become much more careful with their spending habits. One great way for a child to learn about earning is through an allowance. Here are a few ways you can use an allowance to help your child become more financially responsible:
Only earn money for out of the ordinary chores
Turns out, paying your child an allowance for everyday chores such as cleaning their room, being kind to their siblings or washing dishes is not such a great idea. This is not shocking news to most parents. However, when your child goes above and beyond to help out around the house, especially for chores you may have to pay for someone else to do, that is worthy of a reward which can be in the form of a cash allowance.
Not allowance worthy - making their bed or picking up their room
Allowance worthy - weeding the garden for an hour or helping you wash the car
What is the right age?
A lot of people wait far too long to have their children begin helping out with household chores, but kids are smarter and more capable than we give them credit (remember how tech savvy they are). They may not do it as well as an adult, but they are learning. Make sure the chores are age-appropriate and don’t expect perfection. Give your kids plenty of encouragement as they complete their chores and make sure they know their work is an important contribution to the family.
What is the right amount?
Though it doesn’t need to be exact, a good way to know how much to give your child is to use their age. The age of your child equals the dollar amount they should earn per week. If you have a seven year old, they would get $7 a week.
What if my child isn’t motivated by money?
Sometimes kids aren’t motivated by money. You can help with this by setting up a saving system to incentivize them. What’s something they really want but can’t afford right away? Give them a jar or bank and write the name of the item on it. Once they’ve earned enough to purchase that item, make an adventure out of counting their money and going out to get it. BONUS TIP: Set up a second jar called “savings” and put 10% of all of their earnings in it to teach them the importance of saving. Check out this blog for more about the jar concept.
Not all chores are created equal
Some chores are simple to get done but some are more challenging. Make a list of chores and put a higher dollar amount on the more difficult ones. You can also add additional chores that can be done voluntarily for extra allowance (as long as they ask you first).
Here is a small list of chores kids of all ages can help with:
Dust – stairways, table tops, shelves
Empty trash cans
Help wash vehicles
Help clean garage