Benefits of an Allowance
When our son Joshua was four years old, he began to learn that it is more blessed to give than to receive, and we were proud of our youngest child. About this time, he started bringing home snacks for Mama and Papa that he save from his kids group at church. He would bring us watermelon, animal crackers, and even butterscotch candy with the endearing explanation, “You can have dis cuz I dun’t like it much anyway!”
The next week, he came home very excited about sharing his special snack with his “wunnerful” mama and papa. We found ourselves caught up in the whirlwind of bedtime for five children, poor Joshua went to bed still jabbering about the cookies he’d brought home. I hadn’t had the chance to get them from him, so he gave them to Papa with the instructions, “You can made sum coffee and hab it affer we all git to bed!”
After the kids were tucked in and all the kisses had been equally dispensed, I asked Bob about Joshua’s treat. He gave me a wry grin, got up from the couch, and went to the kitchen. He came back with the “treat” wrapped very neatly in a tissue. “Here’s our special surprise—for us to share.”
He unwrapped the two black parts of an Oreo cookie—all that was left of the white filling were two little teeth marks.
Teaching our kids to share, give, save, and work are all part of preparing them for a healthy future when it comes to their financial lives. This is like the cookie part of an Oreo. This training not only helps in the long run, it can help us in the short run—with more money in our pockets! That is the filling! One way to best teach kids is by giving them an allowance and allow them to learn how to budget money, to shop smart, to not ask for stuff, and more stuff, then we spend less and save more!
- Money Matters – The most obvious benefit of an allowance is that it gives the child an opportunity to learn to manage money.
- Safe Haven – When kids learn to manage their money while they’re under our care, they have the freedom to fail in a relatively safe haven. This doesn’t mean that we bail them out, but it does mean that we’re here to help walk them through the steps that will lead the back to the road of financial stability.
- Self Worth – An allowance can make a kid feel good about himself. How do you feel when you’re at the beginning of a paycheck? Your child will learn to feel good over the fact that they have some money of their very own to manage. They’ll feel even better when they learn to give freely, save diligently and spend wisely.
- Consistency – It’s important to pay a child their allowance on the same day of the week or month. This gives them something to look forward to and allows them to budget their needs and wants accordingly.
- Budget – An allowance should be budgeted into your family’s budget, and your children need to know this. It shows them that teaching them about money, through the use of their own allowance, is so important that it ranks in the family budget. It also sends a message to kids about the importance of a budget, thereby priming the pump for the day you will help them develop a personal budget of their own.
- Theirs Alone – The money they receive is something that is theirs; they own it and we help them learn to spend it wisely, according to biblical principles of good stewardship. If we give them their “own” money and then turn around and refuse to let them spend it as they see fit, then it’s just an exercise in futility. We have to create the climate where our children have the freedom to test their limitations, discover how money works and learn in the process. Some of these lessons will be hard, but they won’t learn them if we continue to make all the decisions for them.
- Responsibility and Accountability – These are the main benefits of an allowance as this exercise gives the parents an opportunity to tie in these two elements so that our kids can learn both of these invaluable life skills.
What do you do that is unique in your kids’ allowance?
America’s Family Financial Expert (R)