Holidays are a good time to show them how to make a spending plan and to keep an accounting of money spent. Each method has its own advantages and disadvantages. Giving money to children for special requests may be useful for very young children and for certain expenses such as school fees. With the dole, however, the parent makes all spending decisions and the child has no responsibility. With an allowance, children can learn to plan expenditures, allocate funds and set aside money for later use.
Most children are ready for the responsibility of an allowance by the time they are six to eight.
Earnings give children a sense of freedom and lead to financial responsibility. Children can begin earning money whenever they can handle the work involved delivering papers, babysitting, raking leaves. Employment helps them to understand the relationship between money, time, skills and effort. Work also helps to develop self-esteem. Although the gifts belong to the children, parents can discuss with them how the money should be used.