Allowance ? for those who divide into spend, save and charity

[4Marmalade]

We use this approach for ds1 and dd1's monthly allowance. Dd1 isn't too interested yet but ds1 does a great job. He almost always saves up his money for big purchases. Last year was an adult size wheelbarrow. This year he is talking about a remote control snowmobile. I'm a little confused now as to how to differentiate between the spending and saving category because he saves up so much of his money for these big purchases. What exactly is the "save" category for? How do you differentiate?

Also, this monthly allowance is not related to chores in any way as they both help out around the house quite a bit. But ds1 is a very hard worker and would easily help us with much bigger projects. Do you offer extra $$ for extra jobs they don't necessarily want to do or big jobs they usually help out with happily. Just depends on the day and ds1's attitude .

[bluebunny]

I grew up with this system. My parents did it almost exactly as you describe -- allowance was for "breathing" but we were also expected to do things around the house. We could do certain tasks to earn additional money. Allowance was put into three categories -- 10% in savings, 10% in "God"/tithe, and the rest in spending. We could spend our savings as long as it was a designated purchase.
I'm not sure what age your children are but you could have them put their savings in the bank once they reach a certain amount. For instance, for every $100 they save, they put half in the bank to get interest.

ETA: Just saw their ages in your sig. Might be a little young to open a bank account -- maybe at eight or ten?

[robin3]

Our ds is 9 and we do a weekly allowance that is not based on chores. He is expected to help around the house so the allowance is to teach about money. He puts some in an envelope for charity and some in an envelope for savings and can spend the rest. Now, the savings envelope goes into the bank and is for future large purchases (car, college, etc.) as we want him to be thinking about the future. The money left for spending he can spend on what he wants and will save for several weeks if he wants something big. Right now he wants a new skateboard and is saving for that.
He also enjoys picking out a charity each year to give his money to. This year he chose Children's Hospital.
Sometimes we will give him extra money for chores around the house or yard (usually something WE don't want to do, like picking up the icky oranges that have fallen on the ground!) Last time we did this my parents had given us a bag of walnuts in the shell and we told him we would pay him a penny for every one he cracked and got the nuts out. He quickly figured out it was harder than it looked and asked for more! We do negotiate.....
Hope that helps!

[LynnS6]

I have my kids divide the money into thirds - 1/3 charity, 1/3 spending, 1/3 savings. Right now, they don't distinguish between spending and saving because none of their purchases are huge. What ds covets the most is a $14.99 Webkinz Penguin. I think at 8, saving up $15 is a big enough task (he gets $3/week and $1 goes into giving).

He's also not very interested in the normal kinds of things that kids would use for spending money - candy, movies, etc. When he becomes interested in those things, then I'll distinguish between savings and spending - spending is for weekly 'consumables' and savings is for long term goals.

Right now dd is 5 and very much into hoarding her money. She's got $20 and is highly resisting giving any of it away or buying things for people in need. Not sure what we're going to do about that....

[4Marmalade]

Thanks for the replies. They get double their age/month. So ds1 gets $14 and dd1 gets $8. We tried the weekly thing but we could never remember. I just recently set up a spreadsheet so we could keep track at the Bank of Mom and Dad because we NEVER have any money kicking around and I would have to scrounge up coins which is probably why we forgot so many times.

The only rule we have is that they need to allocate some money into each category. They get to decide how much. So far they have been pretty balanced. Up until now we've used the spending one for all spending and told them the save one is for big things like education, car, stuff when they're much older. They already have bank accounts because they get birthday money which goes in there rather than being spent on more toys. So, maybe we'll start depositing into the bank once they have a large amount saved up. I think we'll continue the way we have been. I just wasn't sure because ds1 is always saving for these big purchases and I wasn't sure if they would fall more under the save category.

[Deirdre]

I am glad you started this thread because I have been meaning to start allowance!


I am really liking the idea that it is not tied to chores. We all help out around that house because we are a family and we have to live together. We all partake of the resources of the family also, hence the allowance.

Gotta go, kids need me!

[MtBikeLover]

Originally Posted by bluebunny

ETA: Just saw their ages in your sig. Might be a little young to open a bank account -- maybe at eight or ten?

My son opened up a savings account at 5.5, DD at 3.5. It's been great for them. DS can tell you on any given day how much he has in his account. He loves to save his allowance and then take it to the bank to deposit it. He totally gets the concept of banks and how they work and how you can make money on your money just by having it in the bank. It was been very educational for him.

We do allowance, but we don't do the three buckets. We let them decide what to do with it. Both kids tend to save most of it because they want to put it in the bank. And DS actually wanted to use his money this year to buy his sister a Christmas present. And he has donated some of his money before also. DD hasn't quite gotten there yet and doesn't like to part with her money, but she does save it.

I want them to want to save or donate because of their choice not because I am making them.