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Allowance Magic: Turn Your Kids Into Money Wizards by David McCurrach


Allowance Xtra/Book Highlights

Kids, Money & Values On Allowances
Connections between allowances and chores, school work and love. Common allowance problems and how to solve them.

Childcraft On Allowances
Look for World Book to spell out the allowance b-a-s-i-c-s in their Childcraft Guide for Parents.

Dr. Spock On Allowances
See what America's leading child care author has to say!

Good Housekeeping On Allowances
A list of dos and don'ts from their Illustrated Guide To Child Care.

Kids, Money & Values On Allowances

Kids, Money & Values - Creative Ways to Teach Your Kids About Money by Patricia Schiff Estess and Irving Barocas (Betterway Books, Cincinnati, Ohio, 1994) sees allowances as a way for your child to learn how to manage money and share in family resources. Connections are explored, tips are presented, problems are pointed out and solutions are suggested.

The allowance-chore connection:

  • Don't tie allowances to chores.
  • Allowances teach money management.
  • Chores teach family responsibility.
  • Use chores to capitalize on your child's natural industry - on their desire to help.
  • Praise, hug and congratulate your child for doing chores well.
  • Give your child a choice of chores.
  • Try to find at least a few fun and interesting chores.
The allowance-school work connection:
  • Don't pay for homework.
  • Set a family quiet time to do homework.
  • Establish that school work is important and a serious endeavor.
  • Don't pay for good grades.
The allowance-love connection:
  • Don't say to your child that you give them an allowance because you love them.
In coming up with the amount, consider:
  • Family values.
  • Money available.
  • What's needed.
  • Age.
  • The going rate.
  • Give at a specific time - choose the beginning or the middle of the week.
  • Make sure they have enough to save some.
  • Increase the amount as they get older and have more needs.

Clothing allowances help children learn to manage larger amounts of money.

Negotiating raises teaches a valuable money management lesson.

Common problems:

  • More week than allowance.
  • Losing allowance money.
  • Lending allowance money to a friend who doesn't pay it back.
  • Saving all of it - never spending any money.
Finding solutions:
  • Get the facts.
  • Help them identify the cause of the problem.
  • Help them determine the solution.
  • Provide encouragement and financial assistance as appropriate.

Return to Contents

Childcraft On Allowances

Childcraft's Guide for Parents (Volume 15, Childcraft - The How and Why Library, World Book-Childcraft International, Inc., Chicago, 1980) sees giving your kids allowances as one of the most worthwhile educational experiences you can provide.

With allowances, kids learn:

  • To plan their spending.
  • The necessity of making choices.
  • To get full value from what they buy.
  • Arithmetic.
  • A sense of logic.

Allowances should be:

  • A share of the family income.
  • No more than the family can afford.
  • The child's to do with as they please.

Initially kids will make mistakes, buy unwisely and may spend all they have as soon as they get it. Over time, they will learn to be selective in their purchases and prudent in their spending.

Allowance dos and don'ts for parents:

  • Do give the same sum on the same day each week.
  • Do increase the amount as:
  • The child learns the possibilities and limitations.
  • Their needs multiply.
  • Do discuss budgeting as amount increases.
  • Do talk about how they may want to spend extra money.
  • Do let the children learn from their mistakes.
  • Don't control the child's buying.
  • Don't insist a child save a portion of their allowance.
  • Don't withhold an allowance because of:
  • Disobedience.
  • Poor grades.
  • Unwise spending.
  • Don't use the allowance as:
  • A bargaining tool to secure good behavior.
  • A bride.

Return to Contents

Dr. Spock On Allowances

In his best-selling book Dr. Spock's Baby And Child Care (Pocket Books, New York, 1992), world renown child care expert Benjamin Spock makes the following points concerning allowances:
  • Allowances are a way for children to learn how to handle money
  • At 6 or 7, children are ready to start learning about saving and spending
  • The allowance amount depends on family customs, finances and the patterns in the community
  • Allowances should not be tied to chores
  • Chores are how children learn to do their share around the house
  • Extra chores are a way for children to earn extra money

Return to Contents

Good Housekeeping On Allowances

Good Housekeeping's Illustrated Guide To Child Care (Hearst Books, New York, 1995) presents the following list of allowance dos and don'ts:
  • Do give allowances to help teach your child money management.
  • Do encourage your child to earn extra money by doing special jobs around the house.
  • Do require your child to save a portion of their allowance.
  • Do allow your child to learn from their own spending mistakes.
  • Don't give allowances as rewards or behavior incentives.
  • Don't tie allowances to chores.
  • Don't restrict spending or set too-far distant savings goals.
  • Don't rule out helping your child with extraordinary spending needs.

Return to Contents

© Copyright 2004 by David McCurrach. All rights reserved. Revised 4/3/04.