Teaching your kids about the value of money is one of the most important parts about being a parent. Without a good understanding of personal finance, too many young adults make poor financial decisions once they leave the nest. These decisions can end up setting young adults back years in their pursuit of a stable financial situation.
GoHenry's US Youth Economy Report analyzed the financial habits of 57,000 American children who used their GoHenry debit card in 2020. Among some notable findings: Parents use a chore chart with prices to help give their children extra money for chores. With American kids and teens earning over $27 million in 2020 including allowance, gifts, and chore cash, it's helpful to have some benchmarks and guidance as to how and what your child should earn.
Is my child ready for chores?
If you've decided to set up chores for kids to earn money and are wondering when to start, remember this: It's never too early for kids to learn the concept and value of money. Giving kids practice earning, handling, and saving money will help them as they leave their house and go out into the real world. You can also use a GoHenry debit card as a tool to help kids and teens learn about how to manage their money or allowance.
Children can start doing chores as soon as they are old enough to understand what you want them to do. Start out with simple chores like making their bed or cleaning up toys. Gradually assign more chores as they get older.
You should also regularly review your child's allowance amount to make sure it aligns with their expectations and responsibilities. An appropriate allowance by age might be 50 cents to $1 per week times the age of your child. So your 10-year-old daughter would get $5 to $10 per week.
How to assign value to chores
One way you can assign value to different chores is by creating a chore chart with a pay rate for each. When you're looking to come up with a price for different chores, you have a couple of different options.
You can loosely tie the allowance dollar value to the amount of time you expect the chore to take. If you find that you have too many chores and don't want to put prices on each and everyone, you can group chores into easy, medium, and hard categories, and assign a price to every chore within each group.
When you're compiling your chore payment chart, you should also give some thought to the consequences if your child does not complete a chore. One option is to subtract the chore's price from the allowance if it is not done to your satisfaction. Another possibility is to withhold any allowance payment until all chores are finished.
There are several reasonable options, so it makes sense to experiment and determine what works best for your family.
Why different chores should cost different amounts
Different chores take varying amounts of work, so it's reasonable you would pay specific amounts for each. Mowing the lawn takes much longer than sweeping the dining room, so adjusting your child's allowance accordingly can be a good lesson in the value of hard work.
Another factor to consider is the age and ability of your child. You might have both an older and younger child tidy one room, but you'd hold your older child to a higher standard and pay a higher amount.
Considering the age and maturity level of your child, the tasks at hand, and your expectations and goals for your child's allowance can help you determine a fair amount for an allowance that fits your family.
Take a look at our latest research to see a chart outlining the going rate for allowance by age.