The issue of whether to give your child an allowance likely will continue to be controversial into infinity, but if you’re a parent or caregiver who has already crossed into the “I’m going to do it” camp, there are still questions left to answer. The biggest, by far, is how much allowance is too much.

The Goal

Allowances are intended to give kids some money with which they can buy items they want or need on their own, and to teach them a little about budgeting. The goal is to give children an amount that is reasonable for what they’re currently going through, but which is not so large that it is overwhelming or disastrous if mismanaged. Age and cognitive level play a huge part in deciding what your child can handle, but other factors such as the family budget also come into play.

By the Numbers

In 2012, the American Institute of CPAS conducted a survey through Harris Interactive that investigated how much people are giving their kids for their allowance. The survey discovered that, for kids aged 4-12 years, the typical payment was $5.90 USD a week. Those in the 13-17 bracket received $14.59 weekly, while those aged 18-25 (yes, these young adults were still being handed a sum) got $34.88. The average monthly amount was $65.

As many people recognize, the amount kids are getting is much higher than it used to be. This doesn’t mean that parents and caregivers are being overly generous or spoiling their kids, however. Inflation means that it takes more to cover costs today than it did in the past, so in terms of purchase power, bigger allowance figures aren’t necessarily letting kids rake in a bunch of stuff.

Where Do You Stand?

The American Institute of CPAS figures are by no means a standard you must try to follow—that is, you don’t have to give your kids these amounts if they aren’t ready for it, or if you cannot afford to do so. They merely show what is typical. Similarly, if you are giving your child more, this is not necessarily bad, either, so long as your child is able to handle what you give him or her well. That said, a few “rules” apply:

• The more your child receives in allowance, the more important it is that your child develops a budget, and that you establish clear expectations for the money.
• No matter the amount you give to your child, emphasize that monetary values have absolutely no connection to personal worth as an individual. Kids with less need to know they can still achieve and be happy without material items, and kids with more need to learn to be compassionate to those who might not be as fortunate.
• Be consistent. No matter if you are going to give your child $2 or $20, give the funds when you said you would. Fail to do this and your child will learn you’re not dependable when it comes to money and will have trouble working on budgeting. If your financial situation changes, be honest about it—don’t pretend like the money is coming if you know it isn’t.
• Give your child some choices. Your child won’t learn anything with the money he has if you don’t let him get some experience working with it. Don’t micromanage, but DO make sure your kid understands his options.