I enjoy reading your column in the 5 Towns Jewish Times. My question is regarding my eight-year-old son and his interest in money. I am thinking about giving him an allowance or some way to earn money for good behavior but don't want to get sucked into a scenario where I’m asked can I have $ for everything thing he does and of course he should be helpful without a reward. What is a good system to integrate both good behavior and an allowance or should they be separate? And if so what are the guidelines for an allowance?
Miriam -Far Rockaway
Miriam, this is a question that has many different aspects. Let’s break it down into four main categories.
If you give your children a solid financial education when they’re younger, it’ll make their future a lot brighter. There are many ways to do this. The simple approach is to involve them in discussions around the home. If you’re buying a new phone, you can tell your kids, “I really wanted to get the iPhone 11 super plus with 18tb of data, but it’s not worth spending money on that since I don’t really need it. I’ll stick with the iPhone 6 plus 128.”
Obviously, this won’t work if your children constantly see you wasting money on useless or extravagant items. Here’s an example: There are many people who would be very hesitant to spend $3500 on a leather couch. However, these same people might quickly spend $4,000 upgrading to leather seats in their car. If you want your children to be financially smart, you need to be as well!
Another issue that many parents face is the “Amazon” challenge. Here’s how it goes. Your child watches you make a purchase using Amazon Prime, and it arrives a day or two later. They didn’t see you pay anything, and therefore they find it hard to understand why you can’t get them what they want, just as easily and quickly. This unfortunately encourages instant gratification, as our children take note of us acquiring items without putting in much effort or time. It might be beneficial for us to take a moment to verbalize our thoughts in front of our children before clicking the “Add to Cart” button. One suggestion might be to explain that it is cheaper online than in the store (if in fact it is), or that the item isn’t sold locally, etc. In most cases, it is easier to do our shopping online, but let’s be careful to express our purchasing considerations, as if we were shopping with our children in an actual store.
There are, however, many opportunities we can utilize to show our children where it is important and worthwhile to spend our money. Spending extra on special foods for Shabbos or Yom Tov teaches your children a great lesson! You can also donate money to Tzedaka, and let them help make the decision as to which organization you’ll help out.
The value of money can be imparted whether one is financially stable or not. For example, when you’re grocery shopping, you can bring your son along and show him how to look for sales (such as choosing the cereal boxes that are on sale for the week). Shopping can become a fun experience for him, and a great lesson as well. “Can you get me a ½ gallon of milk, a dozen eggs, and 6 green peppers for less than $10.00?” Alternatively, when choosing an item, you can casually remark, “Let’s get this brand. It’s a much better value for the money and similar to the more expensive brand.”
There is another great wonderful way to teach children the value of money, and it’s a great disciplinary tool as well. If your child damages something due to irresponsibility, or even because he’s upset, you can make him pay. Here’s an example. “You were upset and broke the vase. That vase cost $59.99 and I need you to pay for it.”
If your son doesn’t actually have any money, you can tell him, “I’ll take the money out of your bank account to pay for it.” Keep in mind, he doesn’t actually need a bank account for this to work, although it’s certainly better if he does. Obviously, this only applies to children who are old enough to understand the concept.
You are now accomplishing two things at once. First of all, he’s learning that actions have an immediate consequence. Secondly, you are teaching him that everything has a value.
The next item on our list, is responsibility. In order to instill in your children a sense of responsibility regarding work, you need to work hard as well. You don’t want to your kids to think you’re a hypocrite. We live in a time where entitlement is the norm. Adults seem to feel that they should receive things without putting in appropriate work, and this feeling most certainly trickles down to our children.
I was recently at a store, and there was a man complaining that he can’t feed his kids since everything is so expensive. He had an EBT card of some sort and he said it barely covered his needs. I asked him what he did for a living, and he said he had no job. I told him that I could get him a job as a manager of a store paying about $48,000 a year, and he told me, “It’s not for me.” I asked him what he was looking for and he said a high paying job that doesn’t require a lot of work. I suggested he go into Chinuch.
I wish I could say I was shocked. I wasn’t. There is definitely a mindset out there that believes every person should be compensated simply for being alive. In my humble opinion, that’s ridiculous. We need to teach our children the value of hard work, and the satisfaction that it brings.
If your son asks you to buy him an expensive toy, help him make lemonade and cookies, and let him set up shop on a side road. The interesting thing is, after he makes the money, he might not even want to spend it! Working hard for money actually helps children become more financially responsible. There are many other ways for children to experience working hard and putting in effort to earn money. For example, offering to shovel snow, babysitting, getting a job in the summer, etc.
There are two things that you need to be careful about when he starts trying to earn money.
Have a good Shabbos
Rabbi Yitzie Ross is a Rebbe and has been working with parents and kids for many years. You can read more about him in the "about" section.