How Much Should You Pay Kids For An Allowance? (By Age)
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An allowance can help your kids learn about earning and saving money. It can be wise for parents to teach these lessons before their children move out and start paying their own bills.
There are different allowance strategies that you can consider to estimate how much to pay your child. But what are they, and how much money should you actually give your kids?
We break down everything you need to know about allowances so you can come up with a strategy that works for your kids based on their age.
What Is an Allowance?
Merriam-Webster defines an allowance for kids as “a sum regularly provided for personal or household expenses.”
This is similar to a paycheck for children who are too young for a part-time job.
There are two different types of allowance payments for children, including fixed and chore-based.
Fixed Allowance
A fixed allowance for kids is when you pay your child a set amount of money daily, weekly or monthly without requiring good behavior or the completion of chores.
As your child gets older, you may increase their allowance amount as they face more expenses. For example, they may need money to hang out with friends, buy gas for their car or eat lunch at school.
You can still require your child to complete basic tasks around the house, but their allowance isn’t performance-based. This household contribution can prevent a sense of entitlement from your child by making sure they don’t come to expect “free money.”
Chore-Based Allowance
It’s also common to require children to complete everyday household chores before getting an allowance. These tasks can vary by household and the age of your child.
Since this is a conditional allowance for kids, you may reduce the total payment when your child doesn’t finish a particular task on time or with their best effort.
If you don’t want to pay for daily tasks like making their bed or maintaining a clean bedroom, you can pay for special chores that require more effort or don’t occur as often.
If you choose this allowance type, be clear about the payment agreement so your child knows what duties they must complete to receive full payment.
How Much Allowance Should a Kid Get Based on Age?
An age-based allowance is easy to calculate and budget for since the payment amount depends on your child’s age.
A basic allowance guideline is to pay $1 or $2 per age.
For example, you might pay your ten-year-old $10 weekly, but your eight-year-old may only receive $8.
How Much Allowance Should I Give My Child?
An allowance report from Rooster Money discovered that the average child earns $9.80 weekly.
This study breaks down the average weekly allowance by age:
| Age (in years) | Allowance amount |
| 4 | $5.12 |
| 5 | $5.46 |
| 6 | $5.99 |
| 7 | $8.05 |
| 8 | $8.19 |
| 9 | $9.18 |
| 10 | $9.85 |
| 11 | $11.15 |
| 12 | $13.11 |
| 13 | $14.80 |
| 14 | 15.70 |
You can use these amounts as a guideline.
These age brackets can also be helpful if you want round numbers:
| Age range (in years) | Allowance amount |
| 4 to 6 | $4-$6 |
| 7 to 9 | $7-$10 |
| 10 to 12 | $10-$13 |
| 13+ | $14-$20 |
Other Allowance Factors to Consider
There are several factors to consider when determining how much money to pay your child.
Their Age
Younger children have fewer responsibilities and expenses. Children can receive allowance raises as they get older since they can take on more responsibilities and their expenses increase.
Monthly Expenses
A child with more expenses may benefit from a higher payout. You may also want to pay more if you live in an area with a high cost of living.
Task Complexity
If you use a chore-based allowance, you may pay more for more difficult chores than easier ones. Each child has their strengths, so you might pay more for tasks that are their weakness.
Effort and Attitude
Parents shouldn’t expect perfection, but their child should put forth their best effort when completing a chore.
It can also be good for them to have a cheerful attitude as this trait can help when working a part-time job for teens.
Budget Categories
Try to have your child allocate some of their earnings for saving and giving. You could make sure their allowance payments are high enough for your child to have a give, spend and save budget.
Other Income Streams
You may begin phasing out of allowance payments as your teen starts earning part-time income. However, you might continue giving older teens an allowance so that they don’t have to work and can focus on their studies instead.
Money Management Skills
While you won’t reduce their allowance amount, you might be more cautious with giving your child their full payment when you begin. One option is to keep their money in a kid-friendly bank but distribute it as necessary after approving purchases.
When to Use a Fixed Allowance
You might use a fixed allowance for kids when you want to offer unconditional payments since you pay the same amount on the scheduled paydays.
This system can be simpler to track as a parent because you don’t have to double-check that chores get completed satisfactorily.
This allowance strategy can be better for these reasons:
- You can still require your child to complete unpaid basic chores
- Extra chores can occasionally be assigned to merit payment
- Your child can focus on other priorities, like school
- You can take away other privileges if your child misbehaves
A potential downside of fixed payments is that they remove the incentive to work hard on daily tasks since your child can receive automatic deposits.
Household chores are part of daily life that adults don’t get paid for. However, these duties can be an easy way to teach children how to make money and think of ways to increase their income.
When to Use a Chore-Based Allowance
A chore-based allowance can be more effective when you want to pay your child for completing specific tasks. In addition, this method can teach the importance of a good work ethic.
A chore-based allowance strategy can be better because:
- Chores can be rotated between kids to avoid boredom
- You have the option to only pay for extra chores
- It motivates kids to contribute around the house
One of the difficulties of this system is that it requires balancing paid tasks and unpaid tasks. It can be easy for motivated children to start asking for money for simple actions that may not warrant payment.
Furthermore, this system can require more creativity as your children get older and you want to transition to more challenging tasks for payment. For example, you may start paying for mowing the lawn but stop paying them for taking out the trash or keeping a clean bedroom.
What Chores to Pay For
The chores you can pay for depending on the child’s age and your household routine.
Several chores you might pay for include:
- Keeping a clean bedroom
- Making their bed
- Playing with pets
- Setting the table
- Folding laundry
- Vacuuming
- Cleaning bathrooms
- Washing dishes
- Sweeping or mopping the floor
- Making dinner
- Watering plants
- Pulling weeds
- Mowing the lawn
- Walking the dog
You may consider assigning the top tasks on this list to younger children. Then, older children with more capabilities can get paid for the higher-level tasks further down the list.
Should I Pay My Kid for Good Grades?
You may decide to pay your children for good school grades if this motivates them. However, if money isn’t a motivating factor, other incentives can do the trick to help your child perform academically.
For this approach to succeed, you may need to pay more when your child gets an “A” for effort but not on their report card or exam.
Paying for good grades won’t be the best tool for every child. Some children might become too stressed by this tactic. It can even put children who struggle academically at a disadvantage.
You might also avoid this payment structure if your child can receive other rewards for getting good grades or being on the honor roll.
Some children who are not motivated by money will need other incentives to excel academically.
When Should My Child Start Getting an Allowance?
You should consider starting an allowance when your child is as young as four but no later than eight years of age to reap maximum benefits.
It’s during these years that children begin understanding these concepts:
- How money works (i.e., you need money to make purchases)
- Importance of saving up for purchases
- Completing chores can help make money or earn other rewards
Consider starting with a small allowance. Then, add additional responsibilities as your child matures and their skillset grows.
Allowance Alternative
If you don’t want to pay your child money, you can also offer other items like a special snack or toy.
Since we live in a digital society where most payments are made electronically instead of with cash, your young child may not be ready for a debit card.
As a result, it’s common for parents to swipe their payment cards, and the child receives the reward. However, this strategy causes them to miss out on the connection of handing their cash to the cashier.
In this scenario, tracking your child’s progress and taking them to the store when it’s time to buy an item or letting them open the Amazon box is one way to demonstrate the physical benefits of receiving an allowance.
Ways to Manage Your Kid’s Allowance
Several chore apps can serve as an allowance tracker to assign chores and automate payments.
These apps also provide a debit card for kids to make cash easily accessible, along with parental controls to track your child’s spending and prohibit certain purchases.
Greenlight
Greenlight offers three different plans featuring allowance, banking and investing tools. All plans offer a rewards debit card that earns up to 2% cash back on purchases.
The allowance features allow you to schedule fixed payments or payments that are released after your child completes chores. Working teens can even use their account details to receive direct deposits.
Two additional reasons to consider this app are the interactive parental controls and financial literacy lessons. These tools can help children improve their money management skills.
A monthly plan costs $4.99 to $9.98 for up to five children.
BusyKid
BusyKid lets parents schedule fixed or chore-based allowance payments. It’s also possible for parents to award bonuses for particular tasks, good grades and pay interest on their child’s savings balance.
This app even includes savings and budget tools. In addition, children can donate to charities directly from the app.
This service costs $3.99 monthly or $38.99 per year upfront. Each plan comes with five child debit cards.
Chase First Banking
Chase First Banking is a free checking account for children between the ages of six and 17. Kids and teens can receive a debit card with customizable spending controls and access to 16,000 fee-free Chase ATMs.
In addition to making it easy to complete purchases and money transfers, this app also lets children create savings goals and complete chore assignments.
This account is exclusive to existing Chase Checking customers.
Copper Banking
Teens who don’t need the hands-on features that BusyKid or Greenlight provide may consider Copper Banking for a traditional banking experience.
This service is free for up to five accounts, and parents can still assign chores, schedule allowances and monitor purchases.
Teens have access to over 55,000 ATMs, receive direct deposits and complete short money-related lessons.
Summary
Each family handles allowance payments differently. However, these guidelines can help you pinpoint an amount for each child in your home.
Recurring allowance payments can be one of the best ways to help teach your child about money. Now is the time to start making a plan and letting your child gain financial experience.