Weekly allowance or monthly allowance?

Weekly allowance or monthly allowance? Yes or no? Advantages, disadvantages, tips and suggestions.

When talking about financial education, it is essential to mention weekly and monthly allowances for children and teenagers. Many parents ask us whether or not they should give their children weekly or monthly allowances and at what age they should start giving them money.

In the workshops we develop for parents, we advocate the importance of children dealing with money as early as possible, presenting its advantages and disadvantages.

Weekly or monthly allowances are the best way to teach children about the importance of financial organisation and budgetary discipline in anyone's life.

Weekly or monthly allowances can act as an instrument of collective awareness, since they require everyone to participate in the process of rational use of money.

It raises awareness of the importance of managing money and promotes saving because it develops a critical sense of appreciation for what is purchased through the financial sacrifice of savings, especially at a time when almost everything seems to be so disposable.

On the other hand, weekly or monthly allowances also have disadvantages. When they become a form of ‘lifelong income’ and cause financial dependence (= perhaps complacency!) in those who receive them, this is contrary to the objective.

Those who receive a weekly or monthly allowance need to bear in mind that its main purpose is to establish a pattern of consumption that is planned and consistent with their financial reality.

The amount of weekly or monthly allowance should be in line with the family's financial situation and should be adjusted or even suspended during periods of financial difficulty.

Parents should not use it as a bargaining chip or a means of repressing/controlling those who give and those who receive.

Finally, here are some tips and suggestions for those who want to start giving their children a weekly allowance or pocket money:

Start with small amounts each week. As awareness and maturity in the use of money develop, increase the time between payments.

Valuing achievements: from buying a simple toy with savings to receiving interest and dividends from an investment;

Avoid giving gifts that are out of season and disproportionate to their allowance, as this discourages the habit of saving;

For further information, please contact AESS at geral@economia-sustentavel.com and find out about our Financial Education workshops for parents and children.

Dulce Forte

Chair of the AESS Board of Directors