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My boys ages 16 and 12 have never gotten an allowance. They have received money as gifts some of which they get and some of which is put into savings. But I'm concerned that they don't know enough and one boy will be graduting next year and off to college. Should I link allowance to chores? Is it too late?

Christine Bradley Replied: Perhaps for the 16 year old who is off to college, linking allowance to chores is moot. The 12 year old could do many chores to help out around the house and earn money. Teaching your 16 year old how to use Excel in a very simple way, could be very empowering for him. He could track his expenses this way and see how the numbers add up. I would suggest the following book "Money Doesn't Grow on Trees" and this may give you many ideas to start with. Working with money is a very creative project, and yet kids need to know the fundamentals. Even going to the bank and opening up an account, or if you've already got each of your kids one, asking someone at the bank to tell them a little bit about how a bank works. There are many stories about money and finance to share with your boys and this will give them possibilities for considering how they want to control their own money.
Posted On 2009-10-14 22:26:11

Neale Godfrey Replied: It is never too late! First, set a budget - a ‘finite' amount that you are willing to spend on each of them, per month, and show them how a real budget works. Have them decide on the amount of clothing, entertainment, and so forth that they need. Afterwards, sit down with them and go item by item to decide what you are willing to spend. For instance, I'm willing to pay $15 for a T-shirt and $35 for a pair of jeans and $55 for sneakers. Teach them how to find bargains and sales in order to keep to the budget you designed. And make this budget quarterly - take the time to sit down with you sons approximately four times a year. For your younger son, an allowance system is highly recommended. A weekly allowance gives your child a source of income that he can learn to make decisions about. In addition, a weekly allowance teaches your child the natural consequences of money -- You get money by earning it. My rule of thumb is to give a child an allowance equal to their age, so your 12 year old would earn $12 per week. The work-for-pay allowance system is based on a specified series of chores that are over and above what is expected of your child as a contributing member of your household. Children should not be paid for any act that relates to personal hygiene or the development of personal responsibility, which I call "Citizen of the Household" chores.
Posted On 2009-09-01 16:59:14

Beverly Willett Replied: There's no way to know if it's too late to link allowance to chores until you try. Parents differ on whether to give allowance and whether to link it to chores, and I think there's no one right answer for all families and all children. And whether or not you do, what I believe is key is that children do learn that pitching in is part of what it means to be a responsible member of a family and second, that they learn the value of money. Certainly if your son is going off to college he'll need to know how to budget. So I'd say whether or not you link allowance or not to chores is your choice. What's key is that whatever sum of money you set aside for him to buy the things he'll need to buy on his own in college -- drug store supplies, going out with friends, clothes, etc. -- have him get used to buying those things on his own now within a designated budget so he can practice how to budget, how to make wise choices, how to live within his means, as well as how to make do or go without if he doesn't choose well. For example, if he decides to blow his "entertainment" allowance in one fell swoop with the super dooper latte, etc. at Starbucks, perhaps he'll have to skip a night out at the movies. It's probably not too early for your 12-year-old to start learning some of these skills, although he has a bit more time before he's out on his own so you might want to ease into it more a bit. If you want to try out an allowance tied to chores, perhaps let him try out budgeting himself with respect to only one category of purchases. Over the years, I've loved sending my kids to the grocery store as well so that they can get a tangible sense of what the food on our table actually costs. All the best.
Posted On 2009-08-07 13:25:07

D. Kristine Manley Replied: It sounds like your boys know that a portion of their gift money goes into a savings, which is good because it's teaching them the importance of saving money. If you are concerned that they might not know enough about certain things, may I suggest some really good books on teen finances along with some teen financial websites. It's never too late to link some chores to an allowance, but explaining the benefits of linking them would be good because your boys may say, "you have not linked monies to what we did before." Let them know that what you are doing will assist them in the long run.
Posted On 2009-07-30 18:37:03