Many parents start giving their children an allowance, and an early age. This is an excellent way to begin teaching them about the importance of good spending and money-saving habits, all rolled into one.
By the time that most children reach the age of five or six they are probably ready to grasp the concept of receiving an allowance and the responsibility attached to it. Of course, at this age children are expected to make a few bad judgments along the way, when it comes to how they spend their money. . . but that is just a part of learning.
Remember this; it is much better to make these mistakes, as a child. Ask the countless adults who, because of bad spending habits, owe mountains of debt. Chances are, the majority of these individuals would not be in their current situation had they learned about proper spending and saving in an early age.
There is really no ‘going rate’ in regard to the dollar amount your child should receive, when it comes to an allowance. The decision is strictly up to you. Some parents may decide to give their children a larger allowance with the stipulation that an agreed-upon percentage must be put in a savings account.
In some cases, the amount of allowance a child receives is based on chores they must do, during the week. In other cases, this dollar amount is based on grades, age, etc.
Although some parents make the decision to pay out an allowance on an ‘as needed’ basis, it is recommended that you consider following a set schedule. . . such as once a week. Doing so, helps children learn about spending limits and how budgeting is important. This method will get them ready for the real world, when they will learn not to live from payday to payday.
Tom Bates, CEO and President is an IAPDA Certified Debt Arbitrator he offers years of experience in both the credit and collections industry and has founded Absolute Debt Solutions, Inc. to assist consumers in need of quality debt settlement at a reduced rate. We understand your already faced with mounting debt and want what is best for you.
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