Allowances Develop Your Child’s Self-Reliance, Responsibility & Powerful Money Habits

“It’s Not How Much Money You Make That Is Important. It’s How Much You Keep.”

It is your decision whether you give your kids an allowance or not. Allowances can be either a good thing or a bad thing. It all depends on how you use it…and what experiences your child has.

Let me ask you this question…

What do our children learn if we just give them an allowance and fail to tie it to such lessons as responsibility, making choices, or becoming self-reliance?

Absolutely nothing!

So, let’s help our kids discover and establish meaningful money habits that they will take into their adulthood.

“OK, what approach could I use, Terry?” you might be wondering.

Let’s read on and look at three approaches..

1. Doing Chores

Let me say up front…I don’t like this approach at all. Our kids should contribute as being part of a family, shouldn’t they?

There are certain duties and responsibilities that kids should do, such as making their bed and keeping their room tidy, helping out in the kitchen and in the yard or feeding the family pets.

2. Rewards For Good Grades And Good Behavior.

Isn’t this teaching our kids that education and behavior are only good for material rewards that they can get?

I would rather see our kids know what they are good at and develop a desire to continue learning AFTER they leave school.

What do you want your kids to focus on – being rewarded or enjoying and improving their learning?
As for the practice of rewarding your kids for their good behavior; do this and you are looking for trouble.

3. No Allowance At All

If your reason for doing this is to help them work out creative ways to buy what they want, then this is fantastic. However, some parents say, “I didn’t get an allowance when I was young. Why do my kids need one?”

That kind of thinking can reinforce the idea that, in order to have money, our kids must trade their time for money, can’t it?  Could our kids then grow up thinking that you have to work hard to make money?

By contributing, we are all sharing the load and all being valued.

OK, what can you do now:

  1. Give your kids an allowance where they are practicing managing their money – saving, investing, budgeting, donating and spending wisely.
  2. Encourage them to become entrepreneurs. Let your kids make mistakes with a small amount. This is far better than making a huge mistake later in life that has serious consequences for them.

START NOW if you have not done so already!

When you follow the steps above, do you think your kids will have a better than average chance of growing up to be more responsible with their money than kids who do not? Yes or Yes?

So, let’s empower your kids with vital financial information – and so increase their financial intelligence. Give them the ‘tools’.

Give them the responsibility of learning how money works. Model and encourage them to develop some simple, powerful money habits.

Does this make sense?

OK, It’s Let’s Talk Time…

I would love to hear what approach you use . Do you give your children an allowance? What for? If they don’t receive one, what are your reasons for this approach? How much do they receive?

I invite you to leave a comment. You will be helping others in our community as well.

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