< Back

The Allowance Project, vol. 1

istock_000000499383xsmall2A confession: I am one of those parents guilty of not always giving my kids their allowances.  I know the disturbing lesson this teaches them — that when they grow up and eventually have bills and debts of their own they really don’t have to pay them on time. They can slide. Little will happen.  Of course, when the mortgage or utility company and not your teens are the creditor, that’s absolutely not the case.  

For the past two years, I have “promised” that this year will be different.  It hasn’t been. Instead, there will come a week when one of my kids (or both) will say, Mom, you owe me 4 (or 5 or 7) weeks allowance.  And not knowing if they are right or — perhaps — giving themselves the benefit of the doubt (that’s parental guilt working in their favor) — I pay up.  

No more.  This year is going to be different.  I just signed up for a two-week trial of a service called ThreeJars.   I had met the founder, Anton Simunovic, at a recent lunch, and heard the pitch for his website.  You, the parent, set the allowance limit for each child. Come payday (Sunday for my kids) the site adds the new money to their total.  If they want cash, they send you an email and you produce it — keeping track of how much you owe them and how much you have already paid. (By approving your cash requests electronically, the amount you have paid is deducted from your kids’ total stash).

The site also allows parents to suggest/control how much kids are allowed to spend, how much they should save for longer term goals, and how much they should give to charity. I’m inclined to let my children make those decisions for themselves, though I made some initial suggestions.  My feeling with allowance is that it’s a mechanism to show them that money is a limited resource.  If they’ve blown through their allotment for the week and they want to go into town to go out for lunch with their friends, too bad.  They’re brown bagging it.   They’ve also shown me over time that they’re more generous with their friend’s charities (or school fund raisers) than I would be myself.  So I’m inclined to leave that to their discretion as well.

I considered other alternatives before signing this route, primarily the two allowance cards on the market — Visa Buxx or MasterCard’s Allow.  These allow you to put the money on automatically (they call it topping up) on a schedule of your choice.  Then your kids can use the cards to withdraw money at ATMs or to spend it at the mall.  There are fees involved, of typically, a few dollars a month, but that’s not why I didn’t go this route — at least to start.  ThreeJars is charging $30 for a year’s subscription per family once your trial period is up.  My problem is that my kids don’t drive. There’s no way for them to get cash without asking me to take them to the ATM.  So if they want it for pizza day at school and they have to run out the door and hop on the bus, it’s easier for them to get it from me. (I hope that in the future — a hope I shared with Simunovic — that ThreeJars will add a stored value debit card so that they can have both options.  I am also looking forward to hearing his answer to this question: Can you add a mechanism so that when my child wants to download a new ringtone — that will automatically add a charge to my cellphone account — I can approve or deny that as well and subtract it from his/her allowance?)

So, how will it go?  How will they react?  I’ll keep you (pun intended) posted.

P.S. I know some of you are wondering how much allowance I give my kids.  The answer: My 15-year-old gets $20 a week, my 12-year-old gets $15.  This is their money for a movie on the weekend with their friends, junk at the mall I refuse to buy, small gifts for their friends, etc.  They both supplement with babysitting.  But I’ve found it’s enough to buy some of the things they want, not all of the things they want.  Like disability insurers, I want my children to have an incentive to work.