From time to time we like to invite local experts from the community to answer questions about parenting and raising kids in Huntsville and North Alabama on a budget. Today we asked Brandon Carrin, Branch Manager with Progress Bank in Huntsville, to address parents’ questions about giving their kids an allowance.
Q.) What should the main focus of giving an allowance to my child be?
The main focus should be educating the child on money and the source of money – work. Work earns you money. If you don’t work you have NO money. Work is something that can bless you and others. You will be rewarded for good work.
Q.) What are the pros and cons of giving my kids an allowance?
The glaring con for giving your kid an allowance is creating the entitlement in his heart. He will believe the lie that he is entitled to money when you start giving him money for simply being. Don’t give your kid an allowance, give him a commission.
Cleaning up his own mess does not warrant commission. It should be understood that you show respect for your home and respect for others by cleaning up your mess. Not to mention the LEGOS that are on the floor could hurt Mommy and Daddy, show concern for others health. Making his bed, picking up his toys, clearing his plate from the table are all his mess and he should not be paid for that. He should be praised for doing those things and celebrated for having right attitude, and he should be corrected when he fails.
The pro to giving your kid a commission vs allowance is that it prepares him for the real world. Your future boss is not going to pay you for doing nothing. This instills work ethic which is good for the family and good for the world.
Q.) What is the right amount to give at different ages?
The amount should be dependent on what you can afford or agree to with yourself or your spouse in your family budget. After that determine the amount per chore or per kid. The smaller the responsibility or the less the chores then the less the reward.
With greater responsibility and greater tasks then greater commission amounts or greater rewards. Regardless of whether you are giving your kids commission or not, they need to be educated on money as early as toddlers. Every moment, pumping gas using the debit card, paying cash for the ice cream at the ball park, counting back change, it is all opportunity to educate and inform.
When it comes to commissions, I believe each kid is different and a mature 4 year old may be ready to grasp the concept and own the responsibility of chores before an immature 7 year old. It depends on the child, but you know your kids and you will know when they are ready. Try this chore chart for ideas.
Q.) How can I set up an allowance system for my kids?
A great place to start is looking at your family’s budget. Determine how much you are willing to pay your kids for work around the house and add it to your budget. Come up with a commission rate for each type of chore. Then sit down with your kids and ask them what extra chores are they willing to do. From that communicate with them what you are able and willing to pay.
Remember to reward good work ethic and attitudes you see. Give grace as they may not be as coordinated as you and do as good as you would. Praise good work and good effort – it goes a long way! Gently instruct when they need help doing a certain chore. Make sure the chore is age appropriate, the four year old should not be weed-eating the yard. If the work is getting better, their heart and attitude is in the right place then consider paying a bonus. Explain why you gave them a bonus.
Editor’s Note: Check out this awesome chore system that worked for one local family!
Q.) What are some good websites or books for parents to better understand financial literacy for kids?
Dave Ramsey has been a blessing to my family in many ways. His website has helpful tools and resources on the topic of money. This topic is so very important and I believe as parents we have multiple opportunities every day to help our kids mature and grow in the area of work and money. They need to understand the value in their work and what it can do for them and for others.
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ABOUT THE AUTHOR: Brandon Carrin is Branch Sales Manager for Progress Bank’s Huntsville office. He has over a decade of banking experience and specializes in helping clients with personal and business banking needs. He and his wife Jessica have been married for over 8 years and enjoy leading “the littles” together. The littles include: son Aiden (6), daughter Emorie (4) and son Ilan (2). Brandon serves as Board Finance Chair for Cove Church and is a large group leader with the youth there. He has served over the last 9 years and continues to serve in various board capacities at the Food Bank of North Alabama. For the past 5 years he has served in an advisory capacity on the North Alabama Revolving Loan Fund. He has recently begun serving as a mentor in the Faith and Finances class offered through The Cornerstone Initiative ministry. He is involved with the Young Business Leaders ministry and most recently joined the Whitesburg Christian Academy PTF board. Brandon enjoys playing outside with his family, hiking, backpacking and bicycling in his free time.
Rocket City Mom is a website about raising children in and around Huntsville, Alabama. Started in late 2010 by a local mom and newcomer to Huntsville, Rocket City Mom has grown into a thriving community of local parents and now boasts a staff of four, thirteen regular contributors, and tens of thousands of Tennessee Valley readers making it the #1 Parenting Resource in North Alabama.