Kids and money management

(Today’s column)

There is an interesting recap on Blogher about parents’ ideas on how to teach kids the value of money. One father says, “I don’t like the word ‘allowance.’ It looks too much like receiving money whether you work for it or not. I personally do not believe this helps to prepare kids for the real world where they are expected to get out there and earn a living. So around the frugal family household you actually have to work to get paid.”

I do not subscribe to that approach. We tried it but we realized it was a huge mistake. I know it’s the “modern” way. But I look at it more as the “capitalist” way and the “materialistic” way — making kids do chores and the amount of allowance they receive are based on what chores they manage to finish. Parents are not employers counting hours worked and tasks performed. Parents have parental obligations and part of that is providing for their children while teaching them about responsibility. Teaching kids to manage their money

Parenting Advice sums it up nicely: “It is best if the children are given an allowance that is not specifically tied to completion of the chores… We want them to complete their chores to help them develop responsibility and skills that they will take into adulthood, not because they are being rewarded with money.”

Now, that makes more sense to me. But in practical terms, how do we do it? When the kids were much younger, they received a daily allowance that was disbursed to them weekly. It was pin money, really, P25 per day if I remember correctly, since they really didn’t spent anything in school because they brought packed lunches and snacks. The thing with such a small allowance, especially when disbursed weekly, is that they didn’t really learn to save. When the weekend came, we’d go out and every little item they saw and could afford (key chains, coin purses, pens, knick knacks…), they would buy. And we couldn’t stop them. We had no right to because it was their money. We couldn’t even say, “Save your money so you can buy the pair of Chucks or camera lens that you want.” With the amount of the allowance, it would take years to save enough for a decent pair of sneakers. So, everything turned out to be an exercise in futility.

So, one day last year, in between classes at HEdCen, I was having this chit-chat about money matters with my students. A boy in the third year class, Emilio, suggested a larger monthly allowance — a realistic amount good enough for major buys so that its owner would think twice about spending on every trivial thing he/she saw. But what was a “realistic amount”? I polled the students present and willing to give out information and we reached a figure — P2,000.00 per month for a high school student.

I listen to kids, okay? They have perspectives adults aren’t capable of. We need to respect them more, really. So, we tried Emilio’s suggestion. P2,000.00 per month per kid but my husband and I still paid for things they needed — clothes, shoes, bags, books and everything they needed for school. And the girls still brought packed lunches to school. What happened? Our older girl, Sam, bought the dog of her dreams with her savings. She’s going to have a large new crate constructed for him too — with her money. She volunteered a deduction in her allowance for the dog’s upkeep. Our younger girl, Alex, en route to becoming a multi-media artist and whose love for anything anime and manga can’t keep her off Comic Alley whenever we’re in the mall, spends her own money when she wants those endless anime DVDs.

And when the girls go out with friends on Fridays or on weekends, what they spend, they take out of their savings. Will they order extra fries and a sundae while hanging out at some junk (err, fast) food joint with their friends? Can they even afford to go out with friends on a particular weekend? They decide because they know how much they can afford to spend at any given time vis a vis how much and how fast they want to save for their next major buy. In short, they learn to set priorities. They learn to distinguish between what they really want and what they can do without.

Sure, we want our kids to learn the value of hard work. We want them to study well, learn how to cook, wash the dishes, do their laundry, clean up their mess, clean up after their pets — but it has to be because they understand the consequences of being a moron around the house rather than because they expect to be rewarded with money. I just don’t want them to think that no deed ought to be done unless payment is in the horizon. Many times, accomplishing something is a reward by itself. The self-satisfaction for doing something on one’s own boosts self-respect and self-confidence, and those are priceless. To attempt to attach monetary value to them is simply idiotic. We’re living in such a materialistic world already; do we help some more to make material girls out of our children?


  1. Miguk says

    I had jobs that’s how I learned the value of money and responsibility. Delivered papers, cut grass, worked on a farm, babysat, grannysat, you name it — experience is the best teacher for sure.

  2. says

    ako nung college, 20 pesos a day ang allowance ko. my mom gave me money on a weekly basis so i learned how to budget.

    20 pesos a day? packingsheet. buhay pa kasi si ninoy nung pumasok ako sa mapua nung 1983. ngayon, nasa 500 pesos na siya.

    time flies.

    • says

      I really like your perspective on this Connie! As a probinsyana I had to learn how to budget my allowance on a monthly basis when I went to college (ah the many senorita sardines days). What I would’ve really liked to have learned more was how to invest the money saved and not just putting them in the bank.

  3. says

    Hazel, some things are “easy” on hindsight. While we were going through all of it, duh, it was so confusing. And there was that nagging insecurity about what if we were wrong?

    Ruth, naku, I agree. I know parents who even bribe toddlers with rewards just to eat their meals. Hay, naku.

    Miguk, now that I encourage. Summer jobs, part time jobs… That’s exposure to the reality of how hard it is sometimes to earn a living.

    Batjay, o lamang lang ako ng 5 pesos sa iyo. Eh ngayon kulang pa pang tricycle yun papunta sa bayan.

  4. says

    yup, you can learn a lot from kids. tayo lang naman mga matatanda ang nag-iisip na alam natin lahat. if everyone just gave kids say in matters that affect them, you’ll be amazed at what you’ll hear from them. sometimes, parang sila pa nga ang mas matanda eh. :)

  5. says

    great insight, di ko naisip yun. when i was in colege, 50pesos and baon ko which i get everyday. sa bahay naman ako kumakain ng lunch dahil 1 jeep ride lang naman ang ust sa balic-balic. i can’t remember how i get to buy with my savings except pang-sine every weekend (a way to reward myself after a week of studies and extra-curricular activities) and yung 35-gal aquarium tank for my cichlids. nakakadayo na din ako kung saan-saang lugar nun with my college friends para makipamyesta at kumain sa jollibee tanauan. hahaha ;-)

  6. says

    BatJay, mas mayaman ka – 2 pesos a day lang ang allowance ko before Marcos regime. I walk everyday from Sampaloc to Mapua to save for some drinks @ Luisa & Sons after our last (late night) period. Going back home to the boarding house, lakad pa rin kahit medyo lasing na, to save for another night out with friends.

  7. says

    I agree. Our kids have to do their chores because they’re part of this family, not because we pay them for it. The older one does get an allowance, and she saves the money for later.

  8. says

    here’s how we look at chores and allowance:
    our child is a part of the family and her chores are her “contribution” as an important team member. although she is too young to get an allowance, she will get a weekly allowance (maybe next year) that is not tied to any of her chores because she is a part of the family. to date, we do not give her monetary rewards or payments for a good deed or achievement. it works out- but we are lucky, as kailea loves doing chores, being organized and helping around the house. in a way, it gives her a sense of belonging and a sense of worth within the family.

    i on the other hand grew up with allowances and with everything i need and want provided to me- so i never really knew the value of money until i had to start paying for rent, car payments, groceries, etc. good thing my parents, on one hand thought us to take care of needs before wants…let’s just say i didn’t get to shop and go out to restaurants as much as i did :) i do not regret it-

  9. Nina says

    Hi Connie,
    I agree with you that children shouldn’t be paid for the chores they do at home. Doing chores is each member of the family’s responsibility. I pay my kid with praises for doing his chores. It gives him a sense of responsibility and accomplishment for a job well done even if it’s putting the recyclables in the recycling bin or washing dishes or stirring the pot of soup.

  10. Miguk says

    I would pay them for their grades even though that is technically their ‘job’…especially my lazy son — that is the only way to get him interested in schoolwork.

  11. says

    It’s always best to teach children how to save money and how to be practical and wise with money. Never use money as a form of reward because this can cause them to become greedy someday. To me, a hug, words of praise and encouragement, and expression of love every time they did something good or helped in the chores is the best because it will teach them to do the same and also builds their good character.

  12. says

    Geri, real estate investment is better than banks or stocks. It’s safe if you follow the rule – buy low, sell high …and location, location, location. Your best investment, is your children.

  13. ice says

    gheeez… 2000 allowance a month for a HS student… with packed lunches and everything… sigh. unfortunately not all parents can afford giving that “realistic” amount to their kids to encourage them to save…

    very nice insight though! :)

  14. says

    The children should be made aware how devalued the peso is so that hopefully they would have the courage to stand up against this injustice instead of inheriting the docility you people exhibit.

  15. says

    ice, “realistic” is always relative and subject to what parents can afford.

    Oh, Tom, I just woke up and you’re making me yawn again. I do hope you don’t have kids. Otherwise, I sympathize with them.

  16. says

    JMonreal, investments is not really something average filipinos like me were exposed to in the Philippines. If we had extra money it’s either we open a business or put them away in a bank. I have learned to appreciate firsthand about stocks and real estate investments through my husband here in the US.

    I have to say the best investment would be our health, not our children. Children are to love and take care of. I don’t see them as investments.

  17. says

    Geri & Connie, I agree with you 101% – your health is your best investment. When I said children are the best investments, I didn’t mean to expect a return or favor from them. It’s about raising your children and giving them the best education you can afford for their future.

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