But those jobs are above and beyond her regular chores. The other point to remember is that if you withhold the allowance when your child's chores aren't done, you're defeating the very purpose of an allowance - that is to put money into your kids' hands so they can learn to deal with it. As your children's money-guide, it will be up to you to set the expectations for how they will manage their money. Getting into the long-term savings habit isn't something that comes naturally to everyone. Starting at an early age will help to establish the habit.
Most financial experts agree that saving ten percent of our gross income is a good bet.
So, for each dollar you give little Molly, have her put ten cents into her savings container. Make sure when you provide the allowance, that you do so in denominations that make it easy to put the savings component away immediately. If a child has to wait until she breaks a five to put away her dollar in savings, the dollar may find it's way into the till instead of the piggy bank. For example, Malcolm might need a container for his video game money, as well as one for his comic book collection. By age ten, most children can transfer their accumulation to paper, using a budget sheet to keep track of their cash flow.