To Pay or Not to Pay Allowance – That is the Question



While many money experts believe that paying an allowance to kids is a good idea, parents across the country are divided on the subject. From the “no allowance” camp to the “give them whatever they need camp”, opinions vary from one family to another. Here are four different perspectives about giving kids allowance to help you decide what your approach with your kids will be.


Kids Get No Allowance


Parents in this group do not believe in weekly allowance just for being a kid, but instead teach their kids that if they want something, they need to figure out a way to earn it. Parents in this group may or may not pay for additional chores. Some parents require their children to get a summer job every year, whether mowing lawn, or picking berries, or cleaning someone’s home. By working for every penny, children learn a sense of the true value of money.


Allowance is Based On Being Good


Some children receive an allowance every week that is not directly tied to their chores, but they know it can be taken away if they do nothing. In this scenario, for example, a teen may get $20 a week but then if they stay out past curfew, it goes down to $10. So it is free money in a way, but only if the teen obeys Mom and Dad.


Receiving an allowance or payment for work is good for kids because it teaches them that money is an important and necessary part of life. Teaching kids how to manage finances with a debit card or cash is a good way to help them learn through their successes and their mistakes. Here is a great option that helps you be in control while giving them the freedom they crave. It’s better for a kid to make a mistake on a small item, that to make a giant mistake on a huge dollar item when they are a young adult. Helping your kids learn to manage money should be a high priority on your parenting to-do list.


Kids Have to Earn Their Allowance


Parents in this category will pay their kids allowance, but the amount varies based on how many of their chores and responsibilities they got done that week. In this situation, children are likely to be awarded a “paycheck” from their parents for their work around the house. Often there is a formal chore chart or work system so the kids know exactly what they have earned and not earned. This type of system is a lot of work, but it can be very effective if done well.


Kids Get Allowance But They Have to Play by Mom and Dad’s Rules


In this scenario, parents pay a set amount of money to their kids, but then they sit down with them and help them figure out what needs to be spent where. It’s kind of like giving responsibility for part of the family budget to the kids. The money comes from your funds, but the child learns how to manage it by paying for school clothes, lessons, and other needs. This usually involves setting aside a portion for charity and savings, and help the kids learn to be wise with their money.


Most money experts agree that paying kids an allowance is a good idea. It can teach children the value of a dollar, it can instill your own financial values if you start at the right age, and it is a great way to incorporate math into everyday life (how many times have your kids gotten out the coins just to sort and count?)


It’s clear that there are many philosophies to handing over money to kids. What’s interesting is that regardless of what method parents use, they believe their approach will help kids learn the value of money.





A prepaid card functions much like a credit card when you are at a store or on the internet, since it can be used wherever credit cards are used. However, instead of putting you into debt for the purchase, you are accessing a pre-paid amount of money that you or your parents have already loaded onto the card.


A great way to use a debit card for your teen is to deposit their allowance or paychecks into their account each week and then help them set aside money for savings, charity donations, or other expected expenses before setting their spending budget. Teach your teen to keep a minimum balance in his or her account at all times just to make sure they never overspend. For a teenager, $100 minimum balance is a good place to stay.



You have the option to allow your teen to use a credit card with a low balance that is owned and managed by you, a debit card connected to a teen’s checking account, or a prepaid card loaded each week or each month by the parent. Many of these options will give parents the ability to receive text messages when teens spend money or go over certain limits. It’s a great way to keep an eye on what your teen is doing while keeping your distance from their all-important “space”. Some credit cards for teenagers will allow parents the option to have certain categories blocked such as gambling sites, pornography or weapons purchasing. This encourages your teen to make good decisions and avoid temptations


All of your purchases appear on a statement that you can review online or through a smartphone app. This gives you the opportunity to see what kinds of decisions you are making with your money when you are away from the temptation and emotion of the moment. By looking objectively at your choices, and with guidance from your parents, you can make goals for your future spending to improve your choices until you are happy with them.


Why a Prepaid Debit Card is Better Than Cash


A prepaid reloadable debit card has many advantages over using cash. Here are a few of them:


  • If your spend smart card gets lost, it can be locked with a simple text message sent to the system by yourself or your parent. No one can use it when it is locked, so any additional money in your account is safe. If you lose cash, you’re out of luck – it’s lost for good.


  • With a reloadable debit card, all of your purchases are listed online in your account, so you can easily see where your money is going. With cash, it’s too easy to forget what you spent it on. This eliminates the hassle of having to manually keep track of your spending every time you make a purchase, but still gives you the advantage of having a record of your spending.


  • If you find yourself in a true emergency, like being in a scary part of town with no gasoline, your parents can quickly and easily load money onto your card with a simple text message or by transferring you money online. There’s no way to do this with cash, so you’d be at the mercy of whoever happens to come along, or have to wait for friends or parents to come rescue you.


Using a reloadable card is one way to help learn financial responsibility without the severe consequences of other spending methods, such as high interest rates of credit cards, overdraft fees from banks, or losing cash. By keeping track of your spending and then analyzing it, you can create a wise spending plan that will help you save for your future.

About Author

LaDonna Dennis

LaDonna Dennis is the founder and creator of Mom Blog Society. She wears many hats. She is a Homemaker*Blogger*Crafter*Reader*Pinner*Friend*Animal Lover* Former writer of Frost Illustrated and, Cancer...SURVIVOR! LaDonna is happily married to the love of her life, the mother of 3 grown children and "Grams" to 3 grandchildren. She adores animals and has four furbabies: Makia ( a German Shepherd, whose mission in life is to be her attached to her hip) and Hachie, (an OCD Alaskan Malamute, and Akia (An Alaskan Malamute) who is just sweet as can be. And Sassy, a four-month-old German Shepherd who has quickly stolen her heart and become the most precious fur baby of all times. Aside from the humans in her life, LaDonna's fur babies are her world.

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