Lesson 2: Allowance...How Much Is Too Much
Giving an allowance is a milestone in the parent-child relationship. If done correctly and with the right frame of mind, it is an extremely valuable teaching tool; however, if done incorrectly, overdone, or given with a skewed frame of reference, it will likely lead to strife, arguments, and a loss of learning opportunities.
The following set of lessons will concentrate on this momentous event in the parent-child relationship, and assist you in weathering the storms that the giving, receiving, as well as spending of an allowance may bring.
How much is enough?
The question of “how much” is almost always the first question a parent will ask when discussing allowances. In order to intelligently answer the question, it is important to remember that the “how much” depends on the “why” of allowance giving.
An allowance given to a child is nothing more and nothing less than an amount of money the parents have, amongst themselves, agreed to give to their child(ren) to help them learn to manage money. It is neither an early version of a “paycheck” nor a subsidy for school necessities, food, clothing or shelter.
For younger children, the under-10 set, the amount should be given weekly; for older children, 10 and over, it can be given bi-weekly, and for preteens or teens who have a part-time job and have done well with their budgeting skills, it may even be given on a monthly basis.
An interesting survey done by "Kid's Money" (1) states the “average” allowance amounts by age and gender. It appears that up to age 9 or 10, $5 per week are the going rate, while ages 11 through 15 see an inching toward $10 per week, while older teens receive an average of about $20 to $25 per week.
The amount may be higher or lower, depending on the parent’s income and the family’s overall budget. Obviously, if your budget closely resembles that of Bill Gates, the allowance you may wish to give to your child will be somewhat higher than for the rest of us.
