I’m a big Dave Ramsey fan. One of the many helpful things we’ve learned from Dave is to pay our kids by commission, rather than allowance. Dave’s reasoning is that paying an allowance – even the name allowance – suggests that you are paying your child, not for work, but for simply being your child. You are making an allowance for him/her.
In grown up, adult life, no one makes allowances for people. You don’t get paid simply because you breathe. You have to work, to whatever level and ability you are able, you should work. Work is healthy for you. I get that I’m a stay at home parent who gets paid in hugs and kisses, not in dollars. But believe me – stay at home parents work!
By getting paid a commission, an agreed upon amount of money for an agreed upon job, kids learn from an early age to associate money with work – or reward with work.
We have a list of jobs with the corresponding list of commissions made. Our kids get paid weekly, though when they were younger they got paid immediately after the job was done. A three year old would have a harder time understanding what he’s getting paid for days later. In order to reinforce the work/reward association, you should pay young kids right away. Older kids can understand waiting until the end of the week and still make the work/reward association in their minds.
Check out what Dave says about teaching kids about money. Do you give your child an allowance? Or a commission?