When calculating an allowance, just know there's no one dollar amount appropriate for all teens, young and old. The amount you decide on should be sufficient to provide him or her with some extra money so they can learn how to handle it.
There's no educational benefit in setting an allowance at an amount at which it's already decided how it will be spent before it's even received. Also, teach your child responsibility and money management by assigning age-appropriate chores and providing a regular allowance (although some experts feel children should have some age-appropriate tasks they're expected to do without pay, simply because they are members of a family. You will need to decide what is best for you and your child). Click here for our Allowance Comparison Calculator and Needs Based Allowance Calculator.
Just know there are many factors that go into fixing an allowance. Here's some GM20 quick info –
What It Covers. If your teen is expected to buy all his or her clothing, gas and school supplies, then their allowance must be sufficient to allow for this kind of purchase. But if you supplement their allowance with spending money, then a less generous allowance may be in order.
In General, For Teens. A good (and fair) way to calculate your child's allowance (especially when you have more than one) is to take the child's age and multiply by 1.5. For example, in general, if your child is 16 years old, 1.5 times that is $24.00. So your child's allowance is $24.00 per week. (You could use a multiplier that increases with age: 0.5 for those 10-12; 1.0 for 13-15; 1.5 for 16-18). Click here for our Allowance Comparison Calculator and Needs Based Allowance Calculator.
Income Definitely Counts. Regardless of your teen's age, only you know how much your family can truly afford. While you may desire to pay a very generous allowance, your family finances may dictate otherwise. Be realistic about what you can afford to pay. Explain that family finances prevent you from giving your child the amount you'd prefer. This in itself is a good life lesson.
What's Your Address. The neighborhood in which you live will probably influence how much allowance you give your teen. While what your child's friends receive may not be a deciding factor, it must sometimes get factored in (obviously teens living in Beverly Hills don't receive the same allowances as teens in inner-cities). While it appears this is really just another way of saying a family's income influences allowance amounts, but there's more to it that–there's peer pressure among teens to get the same allowance that other kids do. Of course, you can take your neighborhood into account when fixing your child's allowance, or you might decide that this element shouldn't be factored in. It's your call.
What the allowance is supposed to cover. If you expect your teenager to buy all his own clothing from his allowance, then the dollars paid to him each week must be sufficient to allow for this extensive purchase. If you supplement an allowance with spending money, then a less generous allowance may be in order.
GM20 Qwik Tip
It's suggested that your child's sex not influence an allowance amount. Boys and girls should be paid the same.
When you have more time, here are some other great resources:
Teen Money Tips: Simple Steps For Banking, Saving & Making Money
Money Still Doesn't Grow on Trees: A Parent's Guide to Raising Financially Responsible Teenagers and Young Adults
