Creating an Allowance System for a Teenager: Part II

Giving Tree

Please read Part I to get a thorough review of how Jolyn set up an
allowance system for her teenage son.

What We've Discovered and Experienced So Far

  • Conner has become much more aware of how much things cost.
  • He's more appreciative of a “good deal”.
  • He's become very interested in ways he can earn extra money.
  • My nagging him to do his chores has all but stopped.

An extra bonus — he's even more thankful for the gifts that he receives!

The Value of a Dollar

Conner used to bug me regularly for “just a few dollars” so he could buy himself lunch at school. He didn't seem to appreciate how much more we could get for those same dollars if he consistently brought his lunch from home.

After starting the new allowance system, the asking for “just a few dollars” stopped completely. Yea! Mom's sanity level quickly spiked. I no longer felt like The Giving Tree that gave and gave but it was never enough.

At first, Conner decided to “treat” himself to buying lunch at school every Friday. Then he started complaining about how “puny” the servings were compared to how much they cost. After a few months, lunches at school almost completely tapered off. He eventually decided he'd rather put those dollars to use somewhere else instead. (e.g. electronics)

Occasionally, he forgets to take his lunch with him and is forced to bum some money off a friend so he can buy it at school. He is always good about paying his friend back, but he's quite chagrined to have to do so. (He hasn't forgotten to take his lunch in for quite some time now…)

Recognizing and Appreciating a Good Deal

Conner used to balk at going to Goodwill with me — I'd wager most teenagers would! One time, however, we struck gold: a brand-new pair of tennis shoes his size, still in their original box. Conner was floored. (I think they were a Tar-ghay brand?)

He just couldn't get over it, “These are only $5!” In his bewilderment he started telling me about a guy in one of his classes at school who made fun of people who shopped at second-hand stores — like he had this sixth sense and could tell or something. Like, whatever. Conner started imagining out-loud how he would ask him what he thought about his brand-new shoes, then casually mention that he got them at Goodwill.

Earning Money

Conner is much more interested in putting himself out there to explore ways to earn extra money. This winter, for example, he and a friend have gone around with their snow shovels offering to shovel neighbors' driveways at about $10 a pop each. They've never come home with as much money as they think they will! Unless you're living on the moon (or in Mexico), it's likely this winter that you've been reminded of what hard work it is to shovel snow! And that's a great lesson, I believe: Earning money can be hard work. They would leave the house with grandiose plans to shovel ten driveways and come home pooped after three. They may not have earned as much as they wanted, but every dollar that came into their hands was highly valued.

We have had to improvise one addition to the original allowance system we wrote out in June to accommodate babysitting jobs. Conner has two younger siblings, ages five and seven, and I occasionally call on him to watch them for me. We have agreed that, if I'm running errands for the family or attending a school function, for instance, then he will not be paid for this service but will do it because he is a part of this family. However, if I'm out to dinner with my friends or otherwise doing something “fun”, he gets $5. We don't quibble over an hourly rate. Yes, it's a deal! (He really has no idea.) But he is pleased nonetheless.

Currently, with my husband deployed, I have been relying on Conner more and more to watch one or both of his siblings so I can get things done out and about without (at least one of) the little yappers tugging on me while I do it. (Having a child old enough to watch his younger children changes your life I tell you what.) Conner is always hopeful that I'm going out to do something “fun” so he can get his $5, but doesn't complain when it isn't. Somehow getting paid to do it occasionally has helped his attitude about helping out even when he isn't financially rewarded.

Not Looking a Gift Horse in the Mouth

Okay, okay… Conner never actually complained (too loudly) about gifts he received… He really is a sweet kid! But since we've started this allowance system, Conner has become much more aware of the value of things and appreciating gifts he is given — especially when it's something that helps him not have to spend his own money!

When his grandparents came to visit, for instance, Grandpa took him shopping for underwear. Yea. Boxer shorts, to be exact. Do you know how much those things cost? Conner was shocked! He had been needing some new ones but couldn't quite get himself to fork over his own cold, hard cash. He was totally excited at the score! (Thanks, grandpa!)

He's also much more appreciative and accommodating when it comes to preparing the lunches that I buy for him. Before I go to the store, I'll ask him if he has any requests or ideas of something new that he'd like to try. Before, he'd usually shrug his shoulders and say, “I don't know,” and act like he just couldn't be bothered with it. Then later he'd complain that he had “nothing to take to school” and that it was all the “same boring stuff” while I tore my hair out.

He's become much more thoughtful and responsive when I ask him now. As per our agreement, what I get for him at the store is quite literally a “free lunch” and he's learning to, well… not look a gift horse in the mouth.

My Nagging Him Has (Almost) Stopped

I simply remind him that he will be paying (usually me) to do a chore if he doesn't complete it. The hardest part is remembering myself to remind him of this! For Conner: Money speaks like his mom never did. I might tell him 15 days in a row (ahem) to come and get his dirty clothes off the bathroom floor. Once I finally think to tell him, “Hey, Conner, this is your last warning to get your dirty clothes off my bathroom floor. From now on, I'm just going to do it myself and you'll owe me a dollar.”

I take my role as the Executive Authority very seriously.

Funny, I only found his clothes on the floor one more time after that. And I'd been looking forward to a little more pocket change…

We Can Always Tweak It

This system may not be perfect, but I have been marvelously surprised at how well it has worked overall. I'm so glad we finally started something — not just for my sanity, but for my son's financial education as well. We will continue to tweak the details along the way, but at least we have a starting point from which to begin the discussion.

And that's another benefit as well, isn't it? Helping my son learn to communicate about finances. Wouldn't that we all could improve in that area of our lives as well!

Jolyn is a mother to three, husband to one, and the financial CEO of her Air Force family that currently makes its home in Ohio. She and her husband recently paid off almost $20,000 in consumer debt in less than a year and are now looking at a game plan to tackle their mortgage(s). Her family ultimately intends to become (and stay!) debt-free while still enjoying the important things in life. She blogs about their daily financial gains and setbacks and the choices that we all make that affect our financial freedom over at Budgets are the New Black.

I have already decided that I am sitting down with our kiddos before summer break and implementing a similar system! Do you have any other suggestions or tips for creating an allowance system for your children?


  1. Barb on April 15, 2010 at 12:50 pm

    All during middle school my oldest son (who’s now 20) bugged me about money. We live in a school district that has extremely affluent families yet on the other side of town there are families that qualify for free lunches. Our family probably sits more in the lower middle section of the population. With that said, all he could see was the money that his friends had. His allowance at the time was only about $4 a week (I know, we were cheap).

    When he was in 8th grade we had a long conversation about money. We explained that all his needs have been met but he will always have wants. We told him we have wants and even the richest people in the world have wants; they just want bigger things. We set up a budget for him in Excel and started giving him $20/week. From that point forward he paid for all of his clothes, tithed, saved money for long term, had a small trip account for camps & church retreats but his actual “allowance” money was only $5 a week. The other $15 was divided up between the categories above.

    We wrote up an actual “contract” for him to sign that said he would pay for his clothes but we would buy his shoes and coats. It said we would buy one magazine a year for him and he had to pay a portion of every trip he went on which would be agreed upon on a case by case basis. He was allowed to allocate any gifts that he received. We also set up a checking account so that he could write a check and pay for his purchases.

    He used this spread sheet until he graduated. It helped him understand that just because he had money in the bank; it wasn’t all available to spend. It helped him to understand that it is important to save for future purchases and it has worked like a charm.

    We’ve instituted the same budget for our youngest son who is now 17 and thankfully, both our sons understand the value of saving and spending.

  2. [email protected] are the New Black on April 15, 2010 at 8:13 pm

    That is so awesome to hear. It’s so nice to hear of someone successfully helping their kids learn to manage their finances. Very inspiring and motivating.

    I just went shopping with Conner today; he needed socks, boxers, t-shirts, shorts… He’s growing and it’s a new season, etc. He asked me a few times if I would pay for one of the things he wanted, but I kept to my end of the bargain. He actually had plenty of money for the things he needed, but he didn’t get as much as he would have beyond his need b/c he “didn’t want to part with anymore money”. This was the biggest shopping trip for clothes, by far, that we’ve done since we’ve implemented the system, and I was quite pleased by how it went. Even just the act of paying for it himself, taking care of the receipts and change… It’s a different mentality than just standing there with your mom and watching someone else hand over the cash (or swipe the card).

    • Barb on April 15, 2010 at 10:24 pm

      The day I knew we were successful was when my son asked for something and I said I’d pay 50%. He then replied it wasn’t worth his 50% so we didn’t buy it because I told him, if it wasn’t worth his money, it wasn’t worth mine. It was a wonderful teaching moment that I still remember five years later!

      • [email protected] are the New Black on April 16, 2010 at 8:26 am

        Exactly! Financial Psychology 101. It’s sooo much harder to part with your own money than with somebody else’s… How much more important is it that kids start making these decisions before leaving home and having to start from scratch when they’re on their own?

        “If it’s not worth your money, it’s not worth mine.” I wish I’d thought to use that line yesterday. It’s definitely going in my repertoire.

  3. Simple in France on April 16, 2010 at 2:14 pm

    Sounds good, especially the nagging less part. I always cringe when I watch people nag teenagers. What is happening is that you are teaching them that you will yap away annoyingly on a topic, yet constantly put up with their behavior for a very long time . . .There is not need to nag when you have a good system in place–especially one with natural consequences. It’s great for their responsibility and your relationship.

  4. Cathie on April 16, 2010 at 3:22 pm

    I really couldn’t afford to give my “first round” of kids an allowance; there was barely enough for the absolute necessities. But I kept them housed and clothed and fed, and they are now for the most part very frugal, thrifty adults. I love that they call me to tell me about the latest bargain, and that they are not above shopping thrift stores. Even my 21 yr. old, who would not be caught dead in a thrift store, has begun to take an interest in sales and coupons, now that she pays her own way.
    I have been toying with giving my 7 yr old an allowance. He is a bit spoiled, being the baby and all, and we have a VERY involved Grandma who is uncooperative and the source of the spoiling, so this will be interesting.
    Great post!

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