How allowances help kids build independence

Have you ever wondered if getting an allowance can make you more independent? Or why some parents give their kids money regularly, while others don’t?

You’re not alone. Many teens, and parents, think about the pros and cons of allowances.

By the end of this article, you’ll know:

• How an allowance can teach independence
• Different ways to earn and manage money
• How apps like Modak help you build money skills that last a lifetime

Why allowance and independence go together 🤔

An allowance isn’t just “free money.” It’s a tool for learning.

When kids manage their own money, they make real choices:

• How much to spend now
• How much to save for later
• Whether to donate or share

These decisions can help develop critical thinking, responsibility, and independence

What’s the purpose of an allowance?

An allowance is a set amount of money parents give regularly, usually weekly or monthly.

Main goals:

• Teach money management
• Show how to budget
• Encourage saving
• Practice smart spending

For teens, it’s a “practice round” for adult life, rent, groceries, and entertainment, but on a smaller scale.

Is giving an allowance a good idea?

Opinions differ.

Pros (when done right):

• Teaches kids to handle money
• Can tie earnings to chores or achievements
• Builds independence

Alternatives:

• Give a fixed allowance without chores, so kids learn to budget a set amount

How allowance builds independence

1. Learning to budget & save

• Plan how to use your money each week or month
• Save for bigger purchases
• Learn patience and long-term thinking

2. Making decisions

• Choose what’s worth buying now and learn to make choices about spending priorities
• Understand trade-offs, spend on one thing, miss out on another

3. Building confidence

• Managing your own money can help build confidence and make you less dependent on parents for every purchase.
• ‍Doing chores early on can help build confidence and self-sufficiency.
• In fact, a large-scale study published in the Journal of Developmental and Behavioral Pediatrics found that kids who did chores in kindergarten scored higher in academic and social measures by third grade.

4. Understanding the value of money

• Learn that money is limited
• Appreciate the effort it takes to earn it

5. Preparing for real life

• Practice setting priorities
• Build habits like saving a percentage of income

How much allowance should kids get? 💰

It depends on age, family budget, and expectations.

General guide:

• Ages 6–10: $1–$5/week
• Ages 11–13: $5–$10/week
• Ages 14–16: $10–$20/week
• Ages 17–18: $20–$30/week

Tip: More important than the amount is how the money is managed.

Pros and cons of allowances

Pros:

• Teaches money skills
• Builds independence
• Motivates kids to work for goals
• Creates a safe space to make financial mistakes
• Can reinforce good behavior

Cons:

• Might create entitlement if not earned
• Risk of poor spending habits
• Doesn’t always reflect real work-life dynamics
• Can cause family conflicts
• Might encourage materialism

Making allowances more motivating 😎

• Tie to chores: e.g., $2 for taking out trash, $5 for mowing the lawn
• Set savings goals: Save for a new toy or gadget
• Reward good behavior: Completing homework, helping at home

Alternatives to traditional allowance

• Kids allowance apps, like Modak, to track chores, earnings, and savings
• Entrepreneurship: Babysitting, dog walking, small businesses

How Modak fits in 🧐

Modak helps teens:

• Track chores and allowance in one place
• Have their parents program their allowance directly into the app
• Get a Visa® debit card with no monthly fees to spend or save their money⁽¹⁾⁽⁴⁾
• Let parents monitor every transaction for safety and guidance
• Earn extra through MBX rewards²
• Walk 5,000 steps a day to earn up to $36/year³
• Complete challenges for even more rewards
• Have opportunities to practice financial skills in an engaging way

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1. Deposit account and the Modak Visa® debit card issued by Legend Bank, N.A., FDIC-Insured. Funds deposited into a Deposit Account may be eligible for up to $250,000 of FDIC insurance. The FDIC’s deposit insurance coverage only protects against the failure of an FDIC-insured depository institution
2. 100 MBX = $1(as of June 2025). This is an approximation and not a guaranteed result. For more information on MBX, visit: Click here for more information on MBX‍
3. Walking 5,000 steps a day gives users 10MBX (as of June 2025). This is subject to change at Modak’s discretion
4. Fees for expedited or premium services may apply. Find out more in our Cardholder agreement.