Why Should Kids Get Allowances - The Top 7 Reasons (cont'd)

5. They can learn to make mistakes with small amounts of money. Kids will learn how to manage their finances responsibly far quicker through being allowed to make mistakes themselves (and suffering the consequences), rather than being told how they should be managing their money by someone else. Parents need to be there to guide their children on how they should spend their money, but not dictate (unless there could be serious consequences from their mistakes).

6. They may stop nagging you for money. The idea is, if they are receiving a regular amount of money, and they have a good understanding of how to budget it then they will never run out of money, so won't keep pestering you for more. Realistically, it will probably never put a complete end to the nagging for money, but it should reduce it.

7. You may end up forking out less money. If you sit down, and add up how much money you give your child during the week & how much you spend on items for them (e.g. clothing), it may actually work out cheaper to give them an allowance, and make them responsible for a lot of their purchases.

As I mentioned earlier, an allowance isn't necessarily the best option for every family, but these are some of the reasons why many parents & educators believe an allowance is the only way to go. Some families though, may not have enough room in the family budget to provide their children with a regular payment, or may simply not believe in it for their own personal reasons. Either way you choose, I have seen with my own eyes, children from each side of the fence who have grown up to be exceptional money managers, and likewise children who seem to have no idea. Ultimately, it comes down to how much guidance a child receives from their parents/guardians on money – whether through an allowance or not.

Rachel Incoll is the author of Kids Money Tips. She has helped show thousands of parents how they can teach their children everything they need to know about money in just a few simple steps. Visit her site http://www.kidsmoneytips.com to find out how your child can learn to save & manage their money more effectively. Sign-up for her free newsletter, & receive 10 bonus worksheets.