Am I Giving My Child Too Much Allowance?

Am I Giving My Child Too Much Allowance?

If you've decided to give your child an allowance, you might be questioning how much is enough. Giving an allowance provides an opportunity to teach your child about budgeting and money management. The goal is to use allowance as a way to impart financial lessons, not to ensure your child can buy every toy they see online.

 

If you give your child too much, they miss out on the opportunity to learn important skills like delayed gratification and patience. So, how much is too much when it comes to allowance for kids?

How to determine if you are giving your child too much allowance

If you're questioning whether or not you're giving your child too much allowance, there's an easy way to tell. If your child never asks you for money and they never have to save up their allowance to purchase something they want, it's possible they're getting too much.

 

The purpose of an allowance is to help your child learn to budget, save, and live within their means. If they never have to wait, save, or sacrifice to get what they want, how will they develop the ability to control their spending when they become adults?

What is the average allowance?

A study by the American Institute of CPAs, reports that 66% of parents give their children an allowance, and the average weekly allowance is $30.

To some parents this average will sound high; for others, it may seem low. While this figure is useful for informational purposes, how much allowance you give will depend on your personal situation.

What to consider when deciding how much allowance to give

There are plenty of variables to consider when deciding on a weekly allowance amount. Here are a few that can help:

  • Age. Generally, the older your child, the more allowance they will get.
  • Family income. What can you realistically afford to give? Just because your child's 6-year-old friend from school gets $20 per week doesn't mean that's what you need to pay.
  • Location. Where you live may also impact how much you want to give. If you live in an expensive city, you may find it necessary to give more.
  • Expectations. What do you expect your children to use their allowance for? Is it just extra pocket money for their personal use, or do you expect your older teens to buy their lunch or pay for their cell phone bills?

How much allowance by age

Trying to figure out the right amount of allowance for kids is tricky. If you're struggling to come up with an amount, here’s a simple approach you can try. Give $1 to $2 per week for each year of age. For instance, a 6-year-old will get $6 to $12 per week, a 15-year-old will get $15 to $30 per week. While this is not a perfect science, it may offer a starting point. You can also check out some research we conducted on the going rate of allowance by age.

 

 

If you are interested in teaching your kids to be better with money, you can try GoHenry, free for 30 days to see if it is the right fit for your family. 

 

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Written by GoHenry Published Mar 23, 2022 ● 2 min. read