“The reason I talk to myself is that I’m the only one whose answers I accept.” George Carlin 
Do you ever feel like you’re just talking to yourself, whistling into the wind? With your kids, does it seem like your words of wisdom go in one ear and right out the other? There’s an adage which states that talk is cheap, and sometimes, as a mom, your verbal currency can seem significantly undervalued. While at work, people stop, focus and listen to what you say, at home your kids too often display a deer-in-the-headlights look when asked to repeat what you’ve just said. The trick with kids is to find a way to turn a lecture into a lesson.
Kids learn best when talk is coupled with action, when what you say (instruction) is linked to observation and experience (what they see and internalize). One way to combine instruction, observation and experience in the realm of money is through an allowance. Through the lessons of an allowance, your talk to your kids about money becomes anything but cheap.
Last year, the American Institute of CPA’s conducted a study on the practice of childhood allowances.  Here are some of the findings:
- 61% of parents gave their children an allowance;
- The average amount was $65 a month or around $15 per week;
- 54% of parents said they started giving allowances by 8 years of age;
- Almost half of the parents also paid their children for good grades (last year, an A was going for $16.60 on average);
- 89% expected their children to work at least an hour per week for that allowance, though the average amount of time spent on chores was reported at just over 6 hours per week;
- Of the parents who gave an allowance, 99% said their children didn’t save any of it; and
- 47% of parents expected to finacially support their children until at least age 22.
For some, talk about money from parent to child consists of a weekly “Here’s your allowance, kid,” with minimal instruction, follow-up, guidance or direction, aside from “Don’t spend it all in one place.” This is opportunity lost, for an allowance provides a parental platform to talk not merely about money with your child; an allowance can be part of an intentional strategy to use money as a means to communicate vital concepts such as personal responsibility, setting goals, making trade-offs and deferring gratification. Helping children learn how to handle money is a great way to help them learn how to handle themselves.An allowance gives a parent the opportunity to introduce financial concepts that lead to the development of skills, habits and values:
-For example, as your child learns to apply the concepts you teach, through the personal trial and error of an allowance, (s)he develops individualized skills. As a mom you know that every kid is different. What works for one doesn’t work for the other. Because an allowance is an ongoing learning experience, it can adapt to different kids and to the changes individual kids go through as they grow.
-As those skills are firmly set in place through repetition, your child is forming habits. You can help direct your child toward healthy financial habits that will be beneficial into adulthood.
-Furthermore, true learning takes place when skills and habits are rooted in the values you want your child to internalize. The “what” of something is always an important lesson, but the “why” of something often proves invaluable.
If you’re not currently talking to your kids about money through an allowance, you can still start. Here are a few guidelines:
How much is enough?
-Appropriate for what the child is responsible to purchase. You and your child need to determine the level of responsibility you are willing to give and your child is willing and ready to accept – the allowance should be prorated accordingly.
-Large enough to avoid frustration but small enough to require choice. Too much money and your child will miss out on the valuable lessons of saving and making trade-offs; too little money and the teaching power of the allowance becomes as ineffective as its buying power.
-Consider your family situation. Figure out how much money you spend on average per week on your child and then allocate a portion to your child’s allowance amount. This won’t be new spending but existing spending done now by your child.
How often should you give?
-Start out weekly and lengthen the amount over time. A week is a manageable horizon for a child to keep in view. As your child matures and integrates the lessons learned, you can extend the allowance period. By the time your child is ready for college, you should be able to transfer over a semester’s worth of expenses with confidence.
-Be consistent. Handing over the weekly allowance should be done as an intentional, important part of the family routine, not done as a last minute, whenever-it-works, whenever-I-have-the-cash, whenever-I-remember event.
How early should you start?
-For most children, by the beginning of first grade. By the time they’re entering first grade, children have the capacity to understand basic math concepts, as well as develop the ability to keep track of personal items, like books or toys, coats or shoes.
How often should you reevaluate?
-Review the allowance contract periodically. As your child grows in age and experience, the allowance you set needs to be reevaluated. You might choose to reevaluate on your child’s birthday or at the completion of the school year.
How should the allowance work when my child doesn’t?
-An allowance teaches responsibility even through failure. The goal of an allowance is to encourage development of skills, habits and values through the handling of money. It’s an ongoing activity and should not be interrupted as a means of punishment for breaking household rules. As a parent, you have other ways of meting out corrective action – that more directly addresses the mistakes or misbehavior.
No one wants to whistle into the wind. As a mom, you don’t want to end up like George Carlin, just talking to yourself. You want your words to land somewhere, to have a positive effect on the life of your child. When you can combine your talk about money with your child’s hands-on experience through an allowance, your words have a better chance of sticking. Instead of him rolling his eyes or her wondering when the lecture will be over, your child will seek you out. You will have established a relationship based upon your child’s recognition of the benefits of all those “teachable moments” the allowance has provided.
Talking to your kids about money can also have a multiplying effect. The practice sparks an awareness of money that stimulates thinking about ways to earn it. A discussion that starts out centered around money with your child can also veer off into other, important areas about growing up, about challenges and struggles, about mistakes and victories. As you talk with your child about money, you open up a door for your child to talk to you about life.
 Jonathan B. Cox & James Schiavone, AICPA Survey Reveals What Parents Pay Kids for Allowance, Grades, American Institute of CPAs (AICPA) (Aug. 22 2012), http://www.aicpa.org/press/pressreleases/2012/pages/aicpa-survey-reveals-what-parents-pay-kids-for-allowance-grades.aspx.