Market rates on kids' allowances

Deciding how much allowance to give a child is a personal decision, but we’ve compiled the statistics on what other parents are dishing out, as a handy reference.

So you’ve decided to give your child an allowance. Congratulations! This will not only make your life easier by creating a go-to response whenever your kid pesters you to buy something (“No, that’s what your allowance is for. Save up until you have enough.”), but will also give your child invaluable hands-on experience managing their own money.

How much allowance to give is completely up to you. Some experts recommend a weekly amount that corresponds to your child’s age — that is, $5 for a five-year-old; $10 for a 10-year-old, etc., but it depends in part on what exactly you expect your child to pay for. For example, my son — whose shopping interests are strictly tech related — started getting $2 a week when he was five, and now gets $5 a week at age 10. It’s enough for him to spend on the occasional small item or app, but he can also choose to save up (along with birthday or holiday money) for a more expensive game or device.

How much you give is less important than being consistent— so your child knows exactly how much to expect each week and can learn to budget — as well as giving kids some control over that money. Remember, they will make mistakes and that’s okay. That’s how they will learn.

For those who want to know what other parents are paying, here’s what we found out about the going rates on allowances:

  • A recent U.S. survey found that kids are getting an average monthly allowance of $67.80, or about $15 to $16 per week.
  • A 2015 survey from BMO found that among parents who gave an allowance, one-third (32 per cent) gave $5 a week, 13 per cent gave $1 a week and 38 percent gave $10 a week or more.
  • An online survey of 496 parents on kidsmoney.org lists the following average weekly amounts by age, as of 2014: Age 3: $3.20; Age 4: $2.85; Age 5: $3.15; Age 6: $3.85; Age 7: $4.10; Age 8: $4.32; Age 9: $5.52; Age 10: $7.18; Age 11: $7.92; Age 12: $9.58; Age 13: $9.52; Age 14: $13.47; Age 15: $15.57; Age 16: $17.84; Age 17: $30.66; Age 18: $40.10.
  • And, if you were wondering how generous the tooth fairy is, last year Visa Canada found that the national average is $3.44 a tooth. It also developed this online calculator to help parents figure out the market rate for their exact location and demographic.

Keep the conversation going

How much allowance do you give your kids?  Post a comment below.

Disclaimer

The views and opinions expressed in this article are those of the author and do not necessarily reflect that of CPA Canada.

About the Author

Tamar Satov

Managing Editor, CPA magazine
Tamar is a journalist specializing in business, parenting and personal finance. She blogs regularly in this space with advice and anecdotes on her efforts to raise a money-smart kid.

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