Kids' Own Money and Charity

[taubel]

We have not done allowances in the past, but starting in January, we will be giving each of our three children a modest amount of money each month. I was planning to do their age each month - so my 10 year old would receive $10 each month. 

Once they are getting an allowance, we will not be buying them any toys, etc. aside from holidays and birthdays. Anything they want will need to be purchased with their own money. (We will still buy clothing, school stuff, etc.)

But what about charity? For example, two of my children have signed up to purchase gifts for local children in need. We usually spend around $20 on these gifts. DH and I will pay this year, but what about next year, once they have been receiving their allowance? Is it then reasonable to make them pay for a portion of the charity gift/donation (like, say, 25%). Or is that too strict based on the amount of allowance they will receive? 

Just looking for opinions/ideas, either way.

[katelove]

Is the $20 gift a once a year thing? If your 10 year old is getting $10/month then that's $120 for the year, 25% of $20 is $5 out of $120 (I'm just thinking "aloud" here, not suggesting that you can't do basic maths BTW). That seems reasonable to me. You could discuss it with them at the start of the year and help them to set aside an amount each month so that they have the $5 at the end of the year.

How old is the other child? To make it fair it may need to be a percentage of their earnings rather than a percentage of what you spend on the gift. If the other child was only getting $5/month for example then $5 for the gift represents a whole month's income rather than just half. So maybe you could rule that 5% (or whatever you think is reasonable) of their pocket money must go to a charity instead of a fixed  dollar amount for all of them.

[zebra15]

Well, did your kids sign up to help the charity or did you sign them up?  Im guessing 'you' spend $20 on the gift, your child may have a different idea when it comes to spending their money.

Really $10/month is not realistic to cover 'all' toys etc, unless you are going all out for birthday, easter, christmas and every other holiday.

I guess I wouldn't make my kid buy the charity gift. (that's 2 months allowance)  Also at $10 month I wouldn't expect my child to buy everything either.

[sleepypeanutsmom]

I thought I'd share what our family does to give another idea.  My children receive a weekly allowance.  There is a portion of their allowance that goes into their wallet, a portion that goes into their "giving" can and a portion that goes into their "savings" can.  For example, my 10 year old gets $5 ($0.50 for every year old she is).  $1 goes into giving, $1 into savings and the $3 she gets to spend however she wants.  I just try and make the math really easy for us.  When she has a birthday and gets more $ then we just adjust what goes into each.  For example, when she turns 11 years and is getting $5.50 we'll just have $1 into giving and $1 into savings and she'll get to spend $3.50. 

For my 5 year olds, they each get $2.50.  They put $0.25 into each giving and savings and get to keep $2 to spend.  I know percentage-wise it doesn't work out exactly the same as my older daughter, but it is just easy math with dollars and quarters.  I don't want to make sure I have the right amount of dimes and nickels for each child each week.  I just use dollars and quarters and we change it at the birthdays.  I think the real lesson here is to learn to give some away, save some for a rainy day, and have some to spend.  I think getting caught up in the percentages can make it hard for everyone. 

Once a year (around the holidays) I ask each one what they would like to do with their "giving" money.  Last year my oldest wanted to give it to the animal shelter so she put it in an envelope and we took it there.  If you do something like that it doesn't matter how much it is.  If your kids need to buy a $20 gift for a family, maybe they could pool their money together to get to the $20?  Whatever amount they are short, maybe you can plan to use $ from your giving fund to make up the difference.  Having everyone work together to help someone else is a nice lesson to learn as well.   

[katelove]

Originally Posted by taubel 

 Is it then reasonable to make them pay for a portion of the charity gift/donation (like, say, 25%).

I don't think the OP is proposing that the kids contribute the whole $20 for the charity gift. She says here "a portion of the charity donation" [bolding mine]. I took this to mean that the kids would pay 25% (or whatever) which is $5 and the parents would pay the rest. 

[arniflora]

My son just turned 7.  What we do is similar to sleepypeanutsmom.  We started giving him allowance in January so are just coming to the end of the first year of allowance.  It has been a great success!

We use the Moonjar (moonjar.com), but you can use any 3 containers.  We give our son $5/week.  $1 goes into "Sharing" and we let him divvie up the remaining $4 into "Saving" and "Spending" as he pleases.  That means at the end of the year, he has $52 to share - give to others.  It has been really wonderful to see that throughout the year, he has chosen to give to a public radio station that we listen to and a local kid's circus.  He's figuring out how he wants to give his remaining "Sharing" money.

If he is given money as a gift (for birthday, etc.),  I consider it just that, a gift, and let him do with it as he chooses.

If you set it up initially that either a specific percentage or a specific amount is designated to "Sharing" (or whatever you want to call it) each week, then there is no need to try to figure out at the end of the year how to separate it.

So, for example, for your 10yo, if you give him $10/month and designate that 10% ($1) will go to "sharing" he will have $12 to give by the end of next year to give to others! 

Our son has $4 to spend/week and he quite patiently will wait those 5 weeks to buy that Lego set he really wants.

At age 6-7, the savings thing is hard for him to understand.  For instance, right now in his "spending" box there is over $20 that he is saving to buy something, but in his "saving" box there is $0!  I figure as he gets older, and his wants get bigger, then the "saving" box will become more used.

We also have stopped buying unnecessaries for him (except for special occasions) so if we do give him a toy/game, "just because," it is our gift to him.  It has completely eliminated "will you buy this for me?!," it has given him power to make his own choices, and helped him understand the concept of money and how to use this tool (money) in our society. 

[crunchy_mommy]

We don't do allowance yet (DS is still a toddler) but what I plan to do is similar to what my parents did with me growing up. Of all the things they taught me & all the good & bad of my childhood, the one thing I think they did 100% right was teach us about finances!

So basically what they did was ask us to put half of our allowance in savings, donate $1 to charity (usually our church), and we could do whatever we wanted with the rest. As soon as we started getting allowance, we went down to the bank & opened a savings account (I had enough for a cheap used car when I started driving!) They would still buy us all necessities and maybe an occasional wants, I don't remember getting toys much outside of holidays though... we had to save for anything else, toys/candy/non-necessary clothing/sponsoring a child/holiday gifts. I think we got a lot more money though... something like $1/year of age every week, not every month.

I guess you have to figure out what is your goal with giving them an allowance. If you want to teach them money management, charity, etc., then I'd consider giving them more (if that's out of the budget, maybe they could be responsible for some necessities to free up room in your budget) and asking them to set aside a portion for charity or savings or "taxes" or whatever else you feel is appropriate. If it's simply a means for them to have some spending money, then $10/month is probably plenty and I wouldn't ask them to pay for charity gifts or anything.