Setting Allowances

The best tool parents have for teaching financial responsibility is an allowance. Even very young children should have discretionary funds to spend as they see fit. Saving, decision-making, planning, sharing, charity, and responsibility are just some of the lessons that can be taught through an allowance.

Also, teach your child responsibility and money management by assigning age-appropriate chores and providing a regular allowance (although some experts feel children should have some age-appropriate tasks they’re expected to do without pay, simply because they are members of a family. You will need to decide what is best for you and your child).

Quick Tip

You’ll need to determine whether or not to increase a child’s allowance after they reach high school. By then, you may require them to supplement an allowance with their own earnings, whether that’s through doing yard work, baby sitting or other after-school or summer jobs. So, if they ask for more money from you, suggest they go out and earn it.

Click to open a Youth Savings or Teen Checking account to help your child manage her allowance.