Should Kids Have To Save Or Tithe?

Balancing Giving, Saving, and Allowances

Should kids have to save or tithe? In this area, probably more than in any of the other allowance basics for kids, parents will need to use their own personal values as the guiding principle. This is especially true for tithing.

Tithing and Allowances

If your family believes that tithing is a key part of your values and that it is not optional, then having the children contribute in the same manner as the parents makes sense.

But, not all children will be eager to part with some of their allowance - even if it's a small percentage. Still, getting them into a habit of giving is part of their money education.

The act of giving isn't restricted just to those directly involved in a formal faith tradition, of course. Secular kids need to learn generosity, too. There are countless opportunities for giving, regardless of your religious affiliation or lack of religious affiliation.

Local nonprofits, for example, provide a wide range of choices and opportunities for charitable giving. And when you allow and encourage your child to choose the nonprofit(s) he or she gives to, the experience becomes that much richer and more personal.

Savings and Allowances

Savings are less of family principle and more of a financial principle. Kids need to learn to save as early as they can.

Their goals at young ages can be simple - toys that cost more than a week's allowance (or month's allowance), for example. The key is to teach them delayed gratification so that they can learn to save for larger things later in life. Eventually, these could include a car and part of their college funds.

I'll include a little about investing here as well. Allowances are not generally a good source of investing funds simply because we're not talking about that much money to begin with. Your child could save up his or her allowance for an entire year and still not have very much to invest.

Establishing some type of investment vehicle - whether we're talking about a college savings account or online stock brokerage account - is ideal if you can manage it. But realistically, it's going to be up to you, as the parent, to fund it, at least until your child is old enough to generate income (either through employment or entrepreneurship) beyond an allowance.

Adjusting Allowances Accordingly

If you do require that a portion of the allowance is for sharing or saving, this needs to be factored into what kids are expected to pay for and the overall allowance total.

Be sure that the net allowance (after tithing and saving) is sufficient to cover the expenses you have agreed that the child will pay. Otherwise, one financial principle is being compromised for another.