Thursday, April 24, 2014
By KJ DELL'ANTONIA
So, you've decided to give your children an allowance. You've made the choice about whether the money is tied to chores or not. But the next questions come close on the heels of the first, and annoyingly, they recur regularly.
How much should your child receive for an allowance? And you can't answer that without responding to last week's parental quandary, asked by R., a mother who spent last summer "feeling like an ATM machine." What should your child's allowance be for?
I have no been-there-done-that answer for this one. I wrestle with it, too. I'd like an allowance to be for casual spending: things like the movies and smoothies R. said her 14-year-old needed cash for. But even at our not-for-profit town theater, a movie with a drink and popcorn will run you a minimum of $14.50 if the movie is in 3-D. That's more than a week's allowance for my dollar-per-year-of-age 11-year-old.
The movie-and-popcorn price is just one example of why this calculus can feel challenging. One cause is relative pricing: "things" like plastic toys can be ridiculously cheap, while those occasional snacks can be ridiculously expensive (think Frappuccino). Giving an allowance large enough to cover the smoothies (even while teaching the lesson of relative cost) can leave a child equipped to buy a crazy quantity of drugstore junk.
The answer probably lies in the relative freedom your child has. Younger children who are rarely out without their parents don't really need "walking around money." They need an allowance to teach them the power of saving up, and to give their parents the power of responding to every single request for candy and small toys with the immortal words of Vicki Hoefle, author of "Duct Tape Parenting," "Did you bring your money?" (I count that as among the Top 5 pieces of parenting wisdom I've ever been given.) When it comes to a special-occasion movie with a friend, financing it separately is fine.
So, younger children need one thing. Children old enough to be out and spending money unsupervised need another. (Repeat after me: fair does not always mean equal.) But both need something. Kids who grow up without an opportunity to discuss how money is saved, spent and managed struggle, as Anne B. described:
"My sis and I did not get allowances when we were growing up in the '80s. But more to the point, our parents never discussed money issues with us, like how much could be spent on clothes during a year. We would ask for things when shopping and be told yes or no on a case-by-case basis.
"There was just a constant sense of not being able to afford a lot of things, but we never knew the rules, and they would change for no apparent reason. There was also no opportunity to go shopping without my mother, since I had no way to pay for anything on my own (until I got a part-time job at 16).
"I later realized that they never used a budget to manage their spending and still don't. I think expenditures were approved or rejected based on whether their account was overdrawn. Because it was so mysterious, the topic of money caused a lot of anxiety for me as a child and teenager."
For older children, finding ways to show them how to budget not just for desired expenses (saving up for that iPod) but for necessities is a great strategy.
One refrain that appeared again and again was that of noallowanceforme: "Please -- GIVE YOUR KIDS AN ALLOWANCE! Give them some freedom to make bad choices now so they learn."
An allowance, then, is "for" two entirely different kinds of things. First, it's for expenses and small pleasures (or, in the case of smaller children, spending and saving up). It's for whatever is reasonably and necessarily spent in your child's life, whether that's clothing, public transportation or regular movies, and then for smaller treats or saved-for bigger purchases.
It's also "for" learning. The parent-as-ATM model is easier on parents in some ways: expenses come up, they're evaluated within the budget, and good (from a parent's point of view) decisions are made. No one spends $50 on quarters at the arcade, or leaves a wallet with weeks of savings behind on the bus.
But those mistakes are as much a part of a strong financial education as the saving and spending. So whether an allowance is for movies or not, the one thing it should be for is for your child to make choices, even if they're not the choices you would make.
Contact KJ Dell-Antonia at: