The parent can encourage children to make careful spending decisions and plan the use of their money. An allowance can help make children independent and give them confidence and self-discipline in handling money. An allowance should be a specific amount of money, decided by both the child and parent and given at a specific time, such as weekly or monthly. As children get older they will probably have more money under their control and become more responsible for their personal spending. Also they tend to appreciate more the goods and services they buy with their own money, especially if they have saved for them over a period of time.
People have differing views on allowances.
Some parents feel that the allowance should be earned by doing household tasks. Others feel that as members of the family, children are entitled to a share of the family income. An allowance can teach children the basics of money management and should not be used to punish the child. An allowance should begin when children can identity coins and cash, know how to count and have spending opportunities. This often occurs around age 5 or 6.