The Momnificent™ Blog

The Do's and Don'ts of Child Allowances

The other day the subject of child allowances came up with one of my clients.  She was trying to decide if child allowances should be tied to household chores.  I know there are different opinions on how child allowances should be handled, but I thought I would share a quick reference list based on my own personal experience with this issue.

1.  DO give your child an allowance.

2.  DON'T wait until your children are older to give allowance.

3.  DO give an amount that is fair.

4.  DON'T tie allowance to chores.

5.  DO have a plan for their financial responsibilities.

6.  DON'T forget to be consistent with paying allowance.

7.  DO require your children to save and share money.

8.  DON'T tell your children what to spend their money on.

A detailed explanation on each of these do's and don'ts can be found in chapter 43 of my book, The Momnificent! Life, but ultimately the decision is yours.  You have to decide for yourself how you feel about each of these suggestions.

Do you give your child(ren) an allowance?  If so, what are your guidelines?  How are they working?

Planning Your Holiday Budget

With just over 70 days until Christmas, it might seem a bit too early to be thinking about the holidays.  However, I always advocate early planning to help alleviate holiday stress.  One of the biggest stressors during the holidays is the extra money going out the door.  So why not start planning your holiday budget now?

It is best not to create extra debt by throwing everything on credit cards, so instead start your holiday budget with a fixed amount you feel comfortable spending for the holidays.  Deciding up front helps you avoid overspending, and gives you an idea on how much you need to allocate from your monthly income to put towards your holiday expenditures.

What does your holiday budget cover?

Your holiday budget should cover gifts/gift wrapping, holiday food/baking, holiday entertainment, cards, holiday clothing and anything else you spend money on during the holidays.

How do you make your holiday gift list?

Start your list with the people you absolutely must buy for.  This could include your children, your parents, your spouse, etc.  Decide a reasonable amount you will spend for each of the "must buy for" people.  Depending on the amount of budget you have left over, you can add to this list with the "would be nice to buy for" individuals.

What are the other non-negotiable holiday expenditures?

Next you want to add the holiday expenditures that are extremely important to you.  For instance, you may have a tradition of baking cookies with the kids, or sending Christmas cards may be something you are not willing to let go of.  Set a budget for each of these expenses and add these to your "must buy for" gift items.

What's left over?

If you have left over money on your budget, then you can begin adding activities or people to your list until you reach your limit.

What if your budget doesn't cover the very basics?

Then it's time to get creative.  Look for inexpensive but meaningful ways to give gifts.  Make homemade cards or send free e-cards.  Make agreements with people to skip gifts this year and do a community service project together.  Do a pot luck holiday dinner and share the expense with other family members.  Brainstorm solutions and remember that the holidays are really about sharing love with family and friends.

Setting a holiday budget is crucial to healthy money management.  The last thing you want in January is a surprise credit card bill, and baffled answers to the questions "I spent how much? and How are we going to pay for this?"

Managing Your Money - Why It Matters

How well do you manage your money?  Do you follow a budget?  Are you free from debt?  Do you pay your bills on time?  Do you spend wisely according to the salary you make?

Money may not bring you happiness, but when it's not managed well, it can bring you a lot of pain.  It's not fun when you can't pay your bills or enjoy nicer things in life like vacations, dining out, or new clothes.  You feel cheated when people around you seem to be blessed with more money.  So how can you have more money?

I'll tell you two little secrets I've learned about being blessed financially. 

1. If you are not able to wisely manage the money that you do have, you are sending a message to the Universe that you are not capable of handling more money.  You will not be blessed with more money until you can handle what you currently have.  So put together a plan and a budget that will enable you to get out of debt and live on the money you make.  Pay your bills on time and be a good steward of your money.  When you are able to be financially wise and responsible with what you have, you will be blessed with more money.
2. Give and you shall receive.  I am a firm believer in this concept.  If you hold too tightly to your money, you are blocking the flow of money and abundance.  I'm not suggesting you go out and blow all your money on unnecessary things.  I'm talking about giving to people in need, donating to charity, or tithing at church.  Give whatever you can - even if it's a small amount.  And remember, you can also give of your time and other resources like used clothing and toys.  When you can let go and give to help others, you will be blessed.  You know the old saying:  What goes around, comes around.  I know this to be true.  Every month, I give 10% of what I make to my church.  I am always blessed with money that comes from unexpected sources.

So, if you struggle financially, give these two ideas a try and see what happens.  For those of you who have had personal experience with these two secrets, please share your success stories.