Saturday, 20 February 2010

• Got Allowance?

  
  

  Growing up, my mother gave me $5.00 a week to do my chores, which included vacuuming and dusting our home once a week, which happened to be a 3rd floor flat.
  

  This meant, there were something like 30-50 stairs in addition to the two bedrooms, living room, and family room, that all had to be vacuumed. I also had to take care of the dishes (though I don't think this was all the time) as well as clean my room.
  
  If I remember correctly, and I could be wrong (since I'm getting "up there" in age), I was 10 when this arrangement started. I never got a raise, but then again, I'm not even sure how consistent I was with my chores.
  
  Regardless of that, I do believe it helped me learn the importance of saving. When I was 12, I started babysitting and earned an additional $5.00 for the week. So, my mother also took me to the bank and opened a "kid" account with me, so I could put money into my savings. I was so proud when it got to $200.
  
  My daughter turns 11 next month and I want her to feel that pride of knowing she can save enough money to buy something important. I want her to learn the importance of saving, not the art of begging.   Up to this point, we have been massively failing in this regard.
  
  I admit it. We spoil our children, not rotten, but to a degree we probably shouldn't. The other month, my husband bought our son a cheap $10 train set at the grocery store because our son was crying for it. When I went after-Christmas shopping for some work clothes, I picked up several puzzles for my son and a few outfits for my daughter. Why? Because I thought they'd like it. Yes, they were on sale, but did they *need* it? Most definitely not. We have just been in the habit of buying them stuff if it felt like it "had been awhile" since they last got something new. Clearly, we shouldn't do this and quite honestly, we can't afford it right now.
  
  So, we started an allowance system. My daughter earns $5.00/week:

  • 40% ($2.25) comes to her in cash and can be spent immediately or saved as she wishes
  • 40% ($2.25) goes into a "long-term" savings, which she can use to save up for larger items (that would cost over $25) and we would match it
  • 10% (50 cents) gets donated to an agency of her choice: Humane Society, the little girl we sponsor in Africa, church, or wherever else she chooses.

  I found this "system" online while searching for "do-able" ways to start a child's allowance.  Allowance is based on child's age in half and paid either weekly or monthly, depending on family's financial situation.  While I'd like to just give her $5.00 a month, I'm not sure that's realistic for us.  And like I said, my goal is to help her learn about the benefits of saving money, rather than spending all the time. I also want to try to curb my husband's and my impulse buys regarding the kids.  Even though "it's only" $5 or $20 or $30, those little purchases do add up!

  What do you think? Is this a fair system? Did you get an allowance growing up? If you have kids, do they get an allowance? Any advice?
  

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