Allowance: give or not?


Specialist clarifies what are the benefits of periodically giving children money

In a survey conducted on CRESCER’s website, 55% of participating readers said they give or intend to start giving their children a monthly allowance from the age of seven. Another 23% started the habit earlier when children were between 5 and 6 years old. A smaller share, of 9% started earlier, with 4 years or less. Only 13% said they do not or do not intend to adopt the custom. Is it best to give children a monthly allowance? Does it help or not in financial education? In the opinion of financial planner Myrian Lund, “money” and “child” combine, yes, and allowance can be a good education tool.

“Allowance is the most efficient method of financial education . By receiving an amount periodically, the child comes to understand the money differently. The sooner your child starts to deal with money, the more financially structured they will be as an adult, “Myrian points out.

How to begin?

According to the planner, it is possible to enter the allowance as soon as the children begin to learn numbers . However, at this time, it is better that the payment is weekly and proportional to the age, that is, a child of 6 years can receive $ 6.00 per week.

But offering the allowance is not enough. It is necessary to pay attention to other attitudes so that the financial education has results. “Parents should only give gifts to their children on specific dates, such as Christmas, Children’s Day and birthdays. If the child wants a toy out of these occasions, she should be encouraged to save money to buy. If the item is more expensive, parents may propose to pay half. The important thing is that it understands that it is necessary to save to have quality of life and that it is not possible to have everything at the time that is wanted “, explains Myrian.

The weekly payment must last until the child begins to have more independence. Then, the monthly amount comes into play, which should be discussed with your child, considering the expenses that he has on a daily basis, such as transportation, snack at school, trips with friends on weekends, among others. Here, the key is that he understands that if he mismanaged, he will lack money during the month.

For the youngest

In the case of younger children, who still cannot count, the piggy bank is an interesting tool, capable of materializing the concept of saving . Moreover, for Myrian, the conversation is one of the strongest allies of financial education. “Parents should help their children make choices. It is valid to put money in the safe to buy a souvenir on birthday, for example. It is also important to explain that money is limited and, instead of saying, simply, that it will not buy something, to say that it is not possible at that moment, because there is a need to save, “he points out.

Financial crisis in the family. And now?

Regardless of age, faced with any financial difficulty, it is important for parents to clarify the situation for their children. A good conversation is also the solution to explain why children of different ages do not receive equal values. “Understanding is important in the financial education process,” says Myrian. Money has a limit and you have to tell children that parents cannot afford to keep the allowance when a parent loses or a job or when the family is going through difficulties for some other reason, for example. “Adults should explain to children that variations in relation to money are common and that people earn different pay,” concludes Myrian.


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