Many parents agree to pay their child a set amount of money in exchange for completed chores. This payment then becomes the child’s allowance. I have been asked many times if this is the right way to introduce allowance and in my answer to parents I always make a point to distinguish between funding allowance and managing the money in the allowance payout.

Paying for chores is a fine way to fund an allowance. But, beware of the potential pitfalls with this approach. When you use the money-for-chores approach to fund allowance, you put a price on every chore you want your child to do the moment you pay them for any one chore. No parent really intends to pay a child for everything they do to help out at home. However, the minute you assign a dollar value to one family chore, you open yourself up to that for all family chores.

So, be careful to remind your child that some chores are family chores, not paid-for performance chores. Some chores are what each family member does simply because they are a member of the family unit. Chores like making their bed, setting the table for a meal, taking the garbage out these are not chores that are paid for. Cleaning out the garage, helping in a family business these are chores that fall beyond the family call of duty and can be paid for through an allowance. Let’s talk about managing the money in the allowance payout with my next post.

Susan Beacham
Written by Susan Beacham

Susan Beacham founded Money Savvy Generation in 1999 after almost two decades in private banking and investment management complemented by considerable time teaching at the elementary level.

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