To Pay or Not to Pay Your Kids for Chores

by | Homeschooling Financial Education

A perennial question for parents is, “Do you pay for chores?”  Kids need money in order to practice making money decisions. For that reason I am a strong proponent of paying kids for some chores, but not all of them.

Kids get money from several sources with chore earnings only one in the mix. Other sources include allowances, gifts (birthday, holidays), special occasions, working for others, and good old-fashioned handouts. So we can see that kids  have money.

However, most kids get their money with no strings attached. This is great fun during childhood. Then reality hits when your child becomes an adult with money obligations and legal responsibilities for her financial actions.

While growing up, getting paid for chores gives kids the satisfaction of getting paid to do something. Yet, they already know that adults work and get paid so this isn’t a new lesson in itself. The important lesson is what happens when money has to be spent for financial obligations.

Kids look at money in terms of the future.  Adults get money and have to figure out how to pay for decisions and purchases made in the past. In the adult world of money this sets up a cycle of managing each inflow of funds to continue paying for spending decisions and obligations.

As parents we believe that letting kids have money teaches them how to manage money. However, what teaches money management is learning how to meet obligations and pay for spending decisions. To this end, there are three important elements of money experience that parents can provide.

Kids need money to manage

Only parents can provide their kids with real money; paying for chores is one method to do this. Parents have the advantage over schools. Hands-on practice is required to learn any new skill, so it is with money. Schools can’t provide real money for kids to practice money management skills.

With our continuing trend to cashless transactions today’s kids need to learn how to manage money that they receive and spend in both cash and cashless forms (virtual money). This includes credit spending, electronic transfers, debit cards–and other forms of virtual money that hasn’t been invented yet. Managing money that exists as a number in a financial account requires more planning than spending a handful of cash.

Kids need responsibility 

Parents and children can agree on certain expenses that become the child’s responsibility, setting the stage for managing expenses as adults. Any child can take money to a store and buy something, but it takes thinking and planning to manage money for expenses and fun, as adults have to do.

Remember, in most instances this is money you would have spent on your children anyway. You can funnel it through their allowance at no extra cost to you!

Kids need to be in control

As difficult as it may be for parents to accept, it is essential for kids to have full control of their money so they have the opportunity to make both good and bad decisions, learn from them, and go forward. A $10 spending mistake by a kid will be a big learning experience. A $1000 spending mistake by an 18-year-old can be a financial disaster with lingering consequences.

Kids learn from real-world experience, meaning that their money has to be part of a stream of funds that has both a past and a future. Parents have to provide funds in a consistent way, much like they provide resources for a child to learn other skills, such as sports or music.

So it matters not so much as to how the kids get the money, but rather what the expectations are for them in managing their money. If your children continue to spend only for their own fun and pleasure, then it will be difficult for them to learn to manage money for both fun and responsibilities as an adult.

There are great lessons to be learned when kids  pay for some child-size expenses that grow with them. Kids can experience the pain and decision-making that adults feel.

Kids can also feel the pride and satisfaction from making good decisions. As parents you can give your kids this valuable at-home financial education that they won’t get anywhere else.

In conclusion the real question is, “How does paying (or not paying) your kids for chores fit into your overall plan for teaching your kids how to manage money?”


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