At the Financial Literacy Counsel we believe that allowances are a teaching tool for both parents and children for the development of valuable relational and financial life skills.
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FOR PARENTS
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FOR CHILDREN
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Step One: Start Date
Line it up when they begin to learn how to add and subtract numbers. This gives them hands on experience of relating what they are learning with real situations.
Step Two: Transparency & Accountability
Use jars or transparent piggy banks to have three separate accounts:
1) Donate 10% for others
2) Save 10% or more for a rainy day
3) Spend 80% or less on yourself and/ or investing
It is a significant learning experience when children see their money grow and deplete in their jars as they spend, donate, and save money.
Step Three: Train a child to be faithful with little and much over time.
How much do I give my child?
- Start with coins
- Helps them learn and reinforce math skills.
- Graduate to bills as you see them develop responsible habits in saving.
- We encourage you to give your children an allowance in an amount that can be divisible
- Let your child learn from mistakes
- Help them learn that financial resources are limited and they must wait until the next time parents choose to give them an allowance.
- Let them spend up to 80% and let them have control over what and where they spend.
Allowances are NOT:
- tools used for manipulating or controlling children.
- a prudent way to get chores done around the house.
- Approach giving an allowance as simply a gift to your child for the fact that they are your child. We warn families against using allowances as a tool to discipline, punish, or reward good behavior.
- Parents are best to approach paying money for chores as a separate issues.
- a tool to promote favourtism among children.
Contact Alphil Guilaran today to learn more about how we can serve and develop solutions for your family or organization.
Alphil Guilaran
Executive Director
604.687.7773
