Money Talks: Allowance VS Pay-Per-Chore for Kids…

At some point on our journey throughout life, we learn that money exists – and not only that it exists – but that it can be used to buy ALL THE THINGS!

This is a tempting notion for even the most resourceful adults, so assuming that children just “know” from the womb how to count, earn, spend or save their money is putting a lot of expectation and responsibility on their little shoulders!

Why we put aside the money “talk” with our kids…

As adults, we sometimes avoid the money conversation with our children for several reasons.

?Maybe we do not know the appropriate age to start talking about money with them…

?Maybe we are uncomfortable with our own financial situation so we are embarrassed to give advice where we fall short…

?Maybe we were taught NOT to talk about money from our parents or grandparents…

?Maybe we just run out of time at the end of each day because we have to make breakfast, go to work, eat dinner, go to soccer, do laundry, take baths and brush our teeth…

Well… NOW is the time to start talking about money with your kids. 

They will learn from what you say and what you do.

If you have experience with financial difficulties or fall short in the money department, you have even more influential life experience to share!  Do not use that as an excuse to avoid the conversation altogether.

If you were taught that talking about money is taboo, think about how that affected your financial decisions as a child, young adult or older adult…

How did that lack of discussion about money help you learn to save, invest for your future or prepare for life?  IT PROBABLY DID NOT.

If not having enough time is your excuse, remember that handling money well is a life skill that is learned – just like good hygiene or being a team player.  Someone HAS to teach you those things; they do not come naturally.  So let’s get to it!

Allowance VS Pay-Per-Chore…

There is no other way for a child to learn how to use money than for them to have some.  This is the tricky part.

We do not want to spoil our kids by just handing them a big wad of cash but we also do not want to be turned in to law enforcement for child labor.  So what is the best solution?

It truly is an individual decision for each family!

Here are a couple of options:


This is a sum of money paid regularly to a person, typically to meet specified needs or expenses (example: forking out $5.00 per week on Sunday)

Advantages –

  • Allowances require no adding/subtracting for whoever gives the allowance; it is the same amount each week, regardless of the situation.
  • The kid knows what they are getting. If you give them $5.00, you might say, “Save $1.00, give $1.00 and spend $3.00.”  It is easy to track for everyone involved.

Disadvantages –

  • No ownership. Your kid can sit on their booty watching YouTube videos of other kids opening mystery toys or they could be working 20 hours per week doing laundry, washing dishes and cleaning toilets.  There is no connection from the dollar to what is or is not getting accomplished.
  • Kids may not know WHY they are getting money. This can be confusing even for adults.  If someone handed you $100.00 on Sunday without any explanation, what would YOU do?  (Pedicure, anyone?)  Or, if they said, “Here is $100.00, make sure you get some work done.” How much effort would you really put in?


This is paying a set amount for each job duty or household chore completed (example: paying $0.50 if they feed the cat or $1.00 if they pick their toys up by the end of the day)

Advantages –

  • They can work more to earn more. This is very similar to most “real life” jobs where you work to earn a wage.  If you are lazy, you get nothing… (Well, usually…)
  • THEY are in charge of their own destiny. If they want a new bike, a princess movie or the newest electronic device, they can learn to calculate how much that item is – and how much work it will take to purchase it.  This is also very similar to how adults make purchases.  We identify what we want, figure out the cost and set aside money out of our budget to buy it.
  • You can put emphasis on bigger jobs (washing the car or doing a whole load of laundry) by offering larger sums of money.

Disadvantages –

  • With pay-per-chore, it is best to give as much immediate feedback as possible; it is more effective if paid out daily – and this can be a little cumbersome. Who has $3.20 in their purse or wallet right now?  ….Exactly.  Weekly is fine too.
  • An adult actually has to use their brain and figure out chores and how to pay for them.


In each household, there will be chores that are just a part of being in the family unit.

Maybe the kids are expected to do the dishes after dinner or feed the cat and there will be no payment for that.

It is okay to say, “Some of these tasks are for keeping a roof over your head”.

To teach good money habits, however, it is imperative that children have actual money to use.

So here’s my challenge to you…

No matter what your background is with the almighty dollar – is to sit down with your children and give them clear expectations about what types of jobs are considered to be “non-paid-you-are-part-of-the-family” jobs and paid jobs.

If you choose to give an allowance, explain what needs to be done to fulfill that allowance (if anything).

If you pay-per-chore, explain how you “priced” each task and why some have higher earnings potential than others.  Give those kiddos the opportunity to fulfill their financial destiny!

*This article was originally published here.  


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