Needs and Wants: Kids and Allowances

How do you talk to your kids about money?

TEXT OF COMMENTARY

Tess Vigeland: Here's another complicated relationship -- parents and kids, especially when it comes to figuring out all this money stuff. I mean, who wants to have that awkward conversation about how much allowance kids deserve?

Beth Kobliner wrote a book called "Get a Financial Life," and she's mother to three kids -- so safe to say she's handled the question herself.

We asked Beth and her oldest daughter Becca to give us a peek into the negotiations.


Beth Kobliner: We recently started giving our kids one dollar per year old, per week. So my 11-year-old, iTunes-loving son gets $11. My six-year-old rams $6 a week into a charity box that he made in religious school. I think he's taking literally the expression, "Charity begins at home." And my eldest daughter, Becca, gets $14. Which, she takes issue with, right Becca?

Becca Kobliner: Yeah, Mom, but that's 'cause it started late last year, and up until then, you were giving us all just one dollar a week. In New York, I'd have to save five weeks just to buy an ice cream cone. And forget about a movie or make up.

Beth: We already pay for most of your needs: Lunches, basic clothes and after-school activities. Allowance is supposed to cover treats like going out for ice cream or buying earrings or head bands or make up at the mall. And it seems to me that $56 a month for a 14 year old is enough money for extras like that.

Becca: When you say it that way it sounds like a lot. But on a week-to-week basis, $14 a week is not all that much in New York City. If I want to see a movie with my friends, it's $12.50! And that means no popcorn, no pizza, nothing else. And it gets awkward. I don't want to ask my friends for the money.

Beth: I know you wouldn't want to do that. But the reality is that since we started this new allowance situation, I often pay for the "main event," like the movie. And because this is all new territory, going out by yourself without dad or me, it's about your choices and your responsibility.

Becca: What about chores? I'm happy to do chores to make more money.

Beth: Sorry, no deal. Chores are about being part of the family, not about hitting us up every time the dishwasher needs emptying. If we started to pay you for making your bed or clearing the table or making polite conversations at the dinner table, we'd be paying you to be part of the family.

I think one thing we have to decide is what needs are. So like last weekend, I gave you $60 for clothes when you went to the mall with friends. It's spring and you've definitely grown again and you do need clothes.

Becca: Yeah, I'm now officially four inches taller than my mom.

Beth: It was an experiment to see how you make choices when shopping for clothes all by yourself. But you came back with make up! And when I asked for the $60 back, you said you thought I gave you the money to spend however you liked on yourself. And you didn't save the receipt from the make up, so we couldn't return it.

Becca: I got a little confused, because you told me the money was to buy things, but you didn't really specify it was for things I needed. And I honestly didn't think to ask for the receipt, 'cause I haven't done it before.

Beth: You're right, I should have been clearer. So from now on, your allowance money is for "wants," and for "needs," like basic clothes that fit you, I'll give you a separate dollar amount to cover that. Or we can just go shopping together.

Becca: I don't know... What you consider "wants," I might consider "needs," like make up. Make up is definitely a need.

Beth: Well, would you prefer that your dad and I gave you a bigger allowance? But listen, that would mean that every time you buy lunch or snacks or frozen yogurt or accessories or movies, even gifts for friends and activities, that would come from the allowance. And if you use that money up, you have to wait until next month. But if you have money left over, then you could save it.

Becca: I'm not sure. I don't have to pay for that much as it is. And I think that if I got a bigger allowance it might mean that I'm actually getting less money per month, since you'd expect me to pay for much more than I do now. But on the other hand, if I got a little more a month, I would definitely give some to charity.

Beth: You do realize you're on the radio, right now? So, I do have lots of witnesses.

Becca: And so do I.

Beth: Did you just talk me into giving you a bigger allowance on national radio? Alright already! We'll work out the details when we get home.

Vigeland: Beth Kobliner and her older daughter Rebecca with "The Allowance Diaries."

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