Creative Child

Should You Give Your Child Allowance?

by Deborah Song

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1. When should I start?

Many experts recommend starting around kindergarten or first grade. While kids can understand broadly how money works before then, they won’t understand the more sophisticated concepts until then, not to mention that kindergarten is around the time when kids begin to learn basic arithmetic, which will come in handy when learning about money management.

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2. Should allowance be earned?

Working for an allowance is a great way to teach a child about the value of a dollar; most of us can agree on this. Where opinions differ is whether children should get paid for things they’re expected to do around the house.

On the one hand, it motivates kids to clean after themselves and to practice good behavior. However, others believe that children should contribute to their family’s responsibilities without getting paid because that’s part of being in a family. Instead of attaching allowance to chores, another option is to encourage kids to be entrepreneurial. “Children can cut grass, cat-sit, babysit, and that sort of thing, to make money from the neighbors. Then they have to learn negotiation and a work ethic,” says Clare Levison, author of Frugal isn’t Cheap: Spend Less, Save More, and Live Better.

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3. What should they do with allowance?

One of the best lessons they can learn from having allowance is saving. If you can help your child put some of his allowance away to save, they will learn a valuable skill early on. You can also encourage your child to share some of it with charity and make them more socially conscious in the process. Bruce Helmer, co-founder of Wealth Enhancement Group and author of Real Wealth: How to Make Smart Money Choices for What Matters Most to You, encouraged his children to use one-third of their allowance for short-term spending, another third for savings and the final third for charity.

4. How much should I give?

Not more than you can afford. Outside of this parameter, it’s really up to each parent what he or she deems to be appropriate. While a kindergartener may have no need for $20 a week, remember that a good portion of that can be put into savings or given to charity.

Deborah Song is a Canadian-born, Los Angeles-based writer, who obtained her master's in journalism from New York University. She is the founder of, and is passionate about helping parents find better work-life balance and proper support through community.

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