How Much Money Do Parents Shell Out in Allowance? — Dollars and Sense
Lots of adults remember receiving an allowance when they were growing up — but chances are good it wasn’t what today’s kids get. A new poll reveals modern children pocket almost $800 a year from their parents.
The survey, conducted by the American Institute of CPAs, found that among the 61 percent of parents who dole out an allowance, about half started doing so when their children were eight years old.
The amount varies by age, but on average, kids get around $65 a month. In exchange, almost all moms and dads require their children to do at least an hour of household chores every week, and roughly half of parents also reward good grades with cash.
So what do kids do with their bounty? Most buy toys or use the money to finance outings with friends, and only one percent set any aside in savings. That’s something Jordan Amin, chair of the AICPA’s National CPA Financial Literacy Commission, finds a bit alarming.
“Parents need to make sure they’re also passing along financial sense with those dollars and cents,” Amin said. “Earning, budgeting and saving are all important lessons that can be tied to allowances – lessons that can help put children on solid financial footing.”