An allowance is a child's share of family income to be used as he or she chooses on certain defined, agreed-upon expenditures. In one family the child may pay for school lunches with allowance money. In another family, the child may be expected to pay for all clothing. Giving allowances is one way to help children gain experience in handling money and making decisions about how it should be spent. The important characteristic of an allowance is that it is a regular source of income.
Children can count on receiving it and can plan for using it.
Since an allowance is a fixed amount of money for spending over a given time period, several factors figure into how much an allowance should be. Start by sitting down with your children and estimating their expenses. Set an allowance based on these estimates and give it on a weekly basis, if possible. Help your children keep a record of expenses during the next few weeks. Then sit down together again and decide if the allowance needs adjustment.