What's the right way to give an allowance?
An allowance is one of the best tools for teaching your kids about money. Some families believe that an allowance should be payment for chores their kids do around the house. Other families strongly disagree. They feel the chores should be done as a family responsibility and the allowance is purely a money management tool.
Whatever you decide is right for your family, be sure to explain that to your kids, so they know why they are getting their allowance. And give them some guidance on how the allowance is to be used. Really, they have four choices when it comes to money: they can either save it, spend it, donate it or invest it for the long term.
Robin Taub is a Chartered Accountant, and author of the book “A Parent’s Guide to Raising Money-Smart Kids”.