What It Means
An allowance is a fixed amount of money a child receives on a regular schedule, usually weekly or monthly, with an understanding about which expenses it has to cover. Utah State University Extension calls it one of the best ways to teach children financial responsibility. The CFPB's Money as You Grow program adds that the money matters less than the conversation: talking with your child about their plans for it is the part that builds skills.
Try It: Turn an Allowance Into a Savings Plan
Example amounts. No official source sets an allowance, so use what fits your family.
Under half a year away at this rate.
More than half a year away. Talk about a smaller first goal, or a bigger share saved.
Nothing is being saved yet, so the goal can't be reached.
How It Sounds at Home
- "You can buy it with your own allowance."
- "Allowance day is Saturday."
- "That comes out of your money, not mine."
The Breakdown
Worked example. Nine-year-old Maya gets $1010,000 stepsA popular daily step goal that began as the name of a 1960s Japanese pedometer; later studies find health benefits begin well below it. See more a week (an example amount). Her parents agree it covers snacks out, small toys and gifts for friends, and that she saves part of it. She wants a $60 art set.
| Weekly allowance | Share saved | Saved each week | Weeks to $60 |
|---|---|---|---|
| $10 | 30% | $3.00 | 20 |
| $10 | 50% | $5.00 | 12 |
| $15 | 30% | $4.50 | 14 |
What the result means. At $3 a week the art set is 20 weeks away, about five months. Saving half brings it to 12 weeks. Seeing those numbers together turns "can I have it?" into a choice Maya makes herself: wait longer, or spend less on snacks now.
How much to give. No official source sets an amount. Utah State University Extension suggests asking other parents what they give and what it covers, then deciding for yourself. It also describes one family's system for older children: $1 for each year of age, handed out at a monthly family meetingFamily meetingA short, regular sit-down where everyone in the household shares news, looks ahead at the week and makes decisions together. See more once the child showed a list of what they'd earned and spent.
Good to Know
Utah State University Extension suggests starting around age six, keeping the system simple enough to manage, and being specific about what the allowance must pay for, such as toys for a younger child or clothing and transportation for a teenager. It advises letting children live with their choices rather than topping up, while keeping your right to veto purchases that are unhealthy or unsafe. Thinking twice before tying an allowance to chores is another of its suggestions, as Buhata's chore rewardChore rewardSomething a person earns for finishing a household job, such as points, money or a privilege, often tallied on a chart and cashed in later. See more page explains. The CFPB's Money as You Grow handout for parents of school-age children says to talk often about how your child plans to use the money, how they actually used it and what they learned.
FAQ
How much allowance should I give?
There's no official figure. Utah State University Extension suggests asking other parents what they give and for what, then setting an amount that fits your budgetBudgetA plan for a set period, usually a month, that lists the money you expect to receive and how you'll spend or save it. See more and what the allowance has to cover.
What age should kids start getting an allowance?
Utah State University Extension suggests about age six, when children start to understand that some things cost more than others.
Should an allowance be tied to chores?
Families decide differently. Utah State University Extension suggests thinking twice before linking the two, and paying instead for extra-large jobs, while keeping everyday chores as part of family life.
Do It in Buhata
Budget, repeating entries
Add the allowance to Budget in Buhata as a repeating entry on the day you pay it, so it's planned like any other household cost.
Open BuhataRelated Terms and Categories
- Chore money
Money a child earns for jobs around the house, often paid for extra work beyond the chores everyone in the family is expected to do.
- Spend save give jars
A way of teaching kids about money by splitting each allowance or gift into three jars: one to spend, one to save and one to give away.
- Financial literacy for kids
The money skills, habits and knowledge children build over time, from waiting for something they want to budgeting, saving and weighing choices.
- Family budget meeting
A planned, regular sit-down where the people who share a household's money look at the budget together, make decisions and agree who does what next.
Sources
Utah State University Extension, "Teaching Children Money Management"; Consumer Financial Protection Bureau, Money as You Grow, "School-age children and earning"; Consumer Financial Protection Bureau, Money as You Grow, "For your child during middle childhood" (handout); Consumer Financial Protection Bureau, "Money as You Grow: Help for parents and caregivers"
- extension.usu.edu/finance/teaching-children-money-managment
- www.consumerfinance.gov/consumer-tools/money-as-you-grow/school-age-children-preteens/explore-earning
- files.consumerfinance.gov/f/documents/cfpb_parents_middle-childhood-handout.pdf
- www.consumerfinance.gov/consumer-tools/money-as-you-grow
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