By Mona Ismaeil

Allowance for kids

Image: Stockphotosforfree

The idea of an allowance or pocket money for children has been discussed in many parent groups, online forums and much has been written about it in magazines. With discussion comes controversy. My daughter is still young at 14 months, but I have thought about this topic a great deal which led me to want to share my findings with our readers. 

When to start?

It is really up to the parent as to when they feel it is appropriate to start but it should be by the age of ten at the latest. Some start as early as three years but it is suggested that by school age (4-5) children will start to have a concept of money and will have had opportunities to make purchases of their own; for example at a school bake sale.

How much?

This is very important. Again it is up to the parent, but it is suggested that children get $0.50- $1 per year of age per week. So a 4 year old would get $2 or $4 per week. I personally believe this is appropriate until the age of 10, after that, I believe it could be increased to $1.50 or $2 per year of age.

S.O.S Rule

The whole idea of allowance is so that children learn to manage their money. We are instilling in them these basic habits from an early age so that we do not have to worry about their finances in the future. It’s really a great concept! The S.O.S Rule is a great way to help children understand 3 main places their money should be going. Usually the total allowance is divided into thirds but you could decide to change the portions as you see fit.

S for Save

Children should have a piggy bank of some sort. 1/3 of their total allowance is put into their piggy bank to save up for bigger ticket items they really want that are considered an ‘extra’. For example, the parent will buy clothes but if they really want a more expensive pair of sneakers, that is for them to save up for.  The ‘save’ aspect should teach them to plan for the future and think long term when it comes to their finances.

O for Offerings

This is about sharing and giving to charity, a very important concept in Islam. They may be donating only a few dollars to start with but we should encourage this habit and make a big deal out of it. When you are giving your Zakat at the end of Ramadan, you could talk to your child about it. Explain why we give Zakat, how it is calculated, etc. Also, you could ‘calculate’ it for them and take their portion to donate as well.  Perhaps, have your child do some research about different charities and have them decide where they feel their money should be donated. You could take them to that charity to give their donation as well. This will make it very real for them and give them a feeling of accomplishment.

S is for Spending

For this portion it is up to you to discuss and decide with your child what they will be responsible to covering the costs of. This can range from hot lunches to extra-curricular activities. Of course basic needs of every child should be covered completely by the parents. There should be some money allocated for ‘Free-Spending’. This is a portion which the child has the ability to do with it what they please as long as they follow your basic rules (ex. No candy).

Allowance and Chores

One in every three parents give allowance for doing chores even though researchers do not view it favourably. Children should contribute at home because they are a member of the family not because they are being paid for it. Also, some children may not do chores if allowance is not important to them and they choose to forgo it.

It is suggested that only chores that are above and beyond their normal tasks be worth a form of payment. This teaches children to work for their money and that they can find ways to make money beyond their weekly allowance. For example, you should not pay a child for making her bed, but you may pay her for helping in organizing the basement.

There is a fine line between teaching children that work means payment and that payment be all they care about. In the real world, they will not get paid for every little thing they do and sometimes even a job requires us to do things out of our job description, but we do it because we care and we look at the big picture.


Children may try to yank at your heartstrings to get a little more out of you but you have to remember why you are doing this. I am not saying everything is set in stone and you should never give them a little extra here and there, because that is not real life either. At the same time, do not let them push you to the point where you have abandoned everything you set out to teach them. For example: If you go on holidays, you may offer to buy your child one souvenir. If they want a second one, you can tell them that they must pay for it. That way, you have given them a treat they will appreciate, you have given them the choice to purchase another souvenir but most important you have taught them that they must decide if something is worthwhile to spend their hard earned cash.

The Lesson

In a nut shell the message you want to get out to your child is that money has to be worked for and earned and if not taken care of it will run out. It is about teaching balance and setting priorities. At the end of the day, it is about giving them the tools they will need to be out on their own.


About the author:

Mona Ismaeil is mother to a sweet little toddler, owner at Modern Hejab  and a blogger.

Do you give allowance to your kids? Please share your tips with other Moms on our forums.