An allowance in exchange for chores teaches lessons
NEW YORK — Can taking out the trash provide a lesson in money management?
It can, if you offer some kind of payment and teach your child how to handle the money.
There’s ample evidence that children learn money habits early in life. Hoping to raise financially savvy adults, many parents give their kids an allowance in exchange for doing simple tasks around the house.
Julie and Mark Parrish pay their three boys a weekly allowance in return for helping around the house.
“We don’t use a chore chart,’’ the West Linn, Ore., mom said, referring to a system for assigning different tasks to children that some families set up. Instead, the boys are asked to complete age-appropriate jobs as they come up. “Anybody can feed the dog,’’ she said, noting that because the boys don’t have specific assignments, each has the opportunity to learn and try new things. Maxwell, 10, earns $10 per week; Tucker, 8, earns $5, and Gage, 7, earns $3.
An allowance in exchange for simple tasks is a good first step, said Meridee Maynard, a financial literacy educator for Northwestern Mutual in Milwaukee. “Part of the idea with an allowance is to make sure you reinforce that in order to earn money, you have to do certain things.’’
Still, other parents balk at the notion of paying for chores like washing dishes or making beds, considering such tasks part of family responsibility. They teach money lessons using gifts and by finding opportunities for kids to earn outside the home.
“We’re a little community, and everybody has to do their share,’’ said Jon Tancredi, a Philadelphia-area father of two. Tancredi does a lot of his own work around the house, and said ever since they were toddlers, his kids Jenna Grace, now 13, and Jack Owen, 10, have been nearby helping in some way. “A job well done is its own reward,’’ he maintained.
Yet he doesn’t dispute the importance of financial literacy. Tancredi said he’s taught his kids using presents they received, or with cash they’ve earned for doing small tasks for neighbors — and his daughter is now baby-sitting. He expects Jenna Grace to save some of her earnings, but knows a teenager will want to spend. “I think one of the parts of earning money is to be able to enjoy spending some of it,’’ he said.