My wife and I have started to get more serious about teaching our children principles of stewardship by providing opportunities for them to earn money and budget it with give, save and spend banks. I’ve shared nuggets of financial wisdom with my 7 year old in the past, but she’s just now getting excited about doing chores around the house to earn money.
That’s why a piece from the Wall Street Journal caught my attention this week. It was a written debate between Neal Godfrey and Jon Gallo, both with varying experience in family financial literacy. Ms. Godfrey argues that an allowance should be based on household duties and Mr. Gallo argued that allowances should be paid independent of children’s chores.
I’ll let you know right now that I sided with Ms. Godfrey. I believe it is important for a child to learn the importance of hard work and how to earn money. If they don’t work or do quality work, they shouldn’t be paid. These are consequences we face as adults.
Both experts seemed to agree that there is a distinct difference between chores and household duties. Chores are what kids get paid to do. They are jobs around the house such as laundry, setting the tables and doing dishes. Duties are responsibilities of the family member which include brushing your teeth, getting dressed, making your bed, etc.
What do you do if children refuse to do chores or household duties? I think Ms. Godfrey sums it up best with this statement:
Citizen of the Household chores are “good behavior,” and if not done, the punishment is behavioral, taking away a privilege, like TV. If Work for Pay jobs are not done, there is no pay.
Should parents pay children an allowance? One of our most important responsibilities as financial stewards is to teach principles of stewardship to our children. I think working hard is one of those principles. Work and earning pay is a valuable lesson for children, but just as important is teaching them how to budget: give, save, spend.
What do you think about these ideas of paying children an allowance?