The great allowance controversy aside, we all want our children to become financially savvy and independent. That means giving them chances to practice handling and managing money. It’s far better for them to make mistakes with $5, $20 or even $200 now than to risk major $50,000 errors as adults.
Whether your kids receive a no-strings weekly allowance, earn pay for chores, or take on small jobs at home and around the neighborhood, here are seven costs they should be responsible for themselves.
1. Checkout Line Purchases
The checkout line is far less fraught when kids bring their own cash. You won’t have to play the “mean parent” who says no all the time, and you also won’t feel pressured to indulge every whim.
“Mom, can I get this 53rd pack of Pokemon cards or a bag of chips?”
“Sure — if you’ve got the money.”
2. Replacing Lost Lunchboxes, Backpacks, Etc.
Looking back, I’m amazed my mother didn’t tether all our belongings to us each morning. My brother and I were masters at leaving sweaters in the gym locker, tossing a freezer pack in the trash, or losing a mitten on the bus.
Sometimes items turned up, and sometimes they didn’t. One effective way to teach kids to value their things is to require them to purchase replacements themselves.
If a lost item is especially pricey, you can front the money if needed — but expect repayment via allowance or extra chores. And make it clear that settling debts takes priority over that new Lego video game.
3. Library Fines
The library is often a child’s first encounter with borrowing and financial consequences. Teach them that if they’re old enough for a library card, they’re old enough to monitor due dates.
A 15-cent late fee now beats a $25 charge later that could have longer-term effects. If they struggle, help them note due dates on the family calendar or place sticky reminders on the book covers.
4. Toys and Video Games
Outside of holidays and birthdays, we can’t fund every single thing our child desires. Toys and video games are ideal early lessons in saving for most kids and a larger purchase they can fund themselves.
Putting money away for college or retirement is abstract to an average 8-year-old, but tucking $2 to $5 a week into a piggy bank for a robot pup makes perfect sense. Retain your veto power over inappropriate or unsafe games, though.
5. Holiday and Birthday Presents
If you’ve attended a child’s birthday party lately, you’ve probably noticed how excessive gift-giving has become. Weddings and other events can be even more over-the-top.
Teach your kids that a thoughtful gift is one that fits within their means. Let them plan presents for siblings or holiday giving. Then help them set savings goals for purchases or encourage making something by hand instead.
6. Cell Phone Plans
If older kids have phones, make sure these recurring costs aren’t hidden from them. Some families make sure allowances cover their share of the bill if they budget wisely, but there are other approaches.
Provide a basic no-data phone for emergencies — but if they want to browse the web and post on social media, they need to find a way to pay for that themselves. This reinforces that you’ll cover the “need” of staying reachable, while other phone features are “wants.”
7. Entertainment and Outings
Family meals and movie nights are generally on parents — that’s part of being a kid!
But if kids want to go bowling with friends, take the optional school trip to an amusement park, or grab ice cream, they can cover those costs themselves. This lets them weigh options and learn that they can afford anything — but not everything.
Childhood should be about fun and freedom, but also about learning. Make sure you give your child chances to budget and make wise spending choices!
Anna Lopez is a personal finance specialist, parent, and founder of the family money blog, Mama Fish Saves. Her mission is to help families feel confident about money so they can hit their goals and raise financially literate kids!
