Teaching kids about money: How our Allowance System Works.

Teaching kids about money: How our Allowance System Works.

Money is one of those things we all deal with, but not enough of us talk about—especially with our kids. And I get it. Teaching children about money sounds overwhelming, or even unnecessary when they’re still young and barely tall enough to reach the counter. But if there’s one thing I’ve learned as a mom, a wife, a small business owner, and someone who has made plenty of financial mistakes—it’s this: kids learn about money whether we teach them or not. So I decided to be the one doing the teaching.

In our home, we’ve taken a hands-on, practical approach to money lessons—because I want my daughter, Eliana, to grow up feeling confident, capable, and in control of her finances. Not confused, intimidated, or reckless.

We didn’t set out to create some “system.” It just kind of evolved as she grew. And I’m sharing it here not because it’s perfect, but because it’s real. And maybe something in it will help your family too.

1. It All Started with Five Dollars

We started small—literally. Eliana was around five or six when we gave her a weekly allowance of $5. Not for existing. Not for brushing her teeth. But for meaningful contributions: setting the table, folding laundry, and cleaning her room. That money wasn’t a reward—it was a reflection of responsibility. She was learning that when you contribute to the household, there’s value in that.

And before you picture some Pinterest chart with color-coded stars—nope. We kept it simple. It wasn’t about micromanaging every task. It was about creating a routine that included her as a capable member of the household.

2. Want More? Time to Clock In

As Eliana got older, her goals got bigger. You know what’s more expensive than slime? Everything. So we added a second layer: work for hire.

Eliana comes to the bakery with me when she wants to earn more than her regular allowance. And I pay her $10 an hour—not for hanging around, but for real work: cleaning chairs, restocking pastry boxes, organizing my office. Tasks I would pay someone else to do. If she wants the money, she’s got to earn it.

And let me tell you—she loves this. She feels grown-up. Empowered. Responsible. Like she’s in on the magic of running things. It’s not just about the cash; it’s about being part of something real.

3. Then Came the Scooter Incident

Ah yes. The Great Scooter Crisis of Year Seven.

By this time, Eliana had saved nearly $500. In fives, mostly. A tiny fortune, stacked in a box she treated like a treasure chest. One day, we went to buy her a new bike—thanks to my mom—and while we were in the store, she spotted The Scooter. It was $110. She turned to me with those sparkly eyes and said, “It’s okay. I’ll buy it with my money.”

I paused. I knew this was one of those moments.

We got home. She counted out her bills—slowly. Her excitement drained with each fiver. When I told her it came to $125 with tax, her lip started to quiver. And then, she said it:

“Do you know how long it took me to save this money?”

Yes, baby girl. That’s exactly why this moment matters.

She paid. Through tears. And it changed her. She learned what it feels like to spend your money. On your choice. And how quickly it can disappear.

After that? She started asking to work more. Started checking prices. Started walking away from things she once would've begged me for.

That scooter was the most valuable $125 I’ve ever seen spent.

4. No Jars, No Rules—Just Decisions

I know there are all kinds of structured systems out there: save, spend, donate jars. Budget charts. Apps. Those are great if they work for your family. But in our house? We keep it flexible.

Eliana decides what to do with her money. Some days, she spends. Other times, she saves. Last year, she donated $50 to an animal shelter completely on her own. I didn’t suggest it. She just felt like doing something good with what she earned.

We let her experience the full range of what money can do—so she can figure out her own values.

5. She Gets Paid Like a Real Employee

Her regular allowance is monthly—consistent and predictable. Her bakery earnings? Paid via e-transfer straight to her bank account at the end of each shift. (Because she lives for that “money just landed” text notification.)

She knows when payday is. She expects it. And she manages it. Like a little grown-up with better snacks and a cuter backpack.

6. She’s More Thoughtful Now

After the scooter incident, something shifted. She still wants things—of course—but she stops and thinks now.

She’ll hold something in a store and say, “Hmm… I don’t think it’s worth it. ”Music to my ears.

That’s not me saying no. That’s her learning value. That’s ownership. That’s maturity. And that’s exactly what we were going for.

7. The Confidence Is the Best Part

She doesn’t just understand how money works—she feels confident around it. She sees me working hard. She sees what things cost. She sees that she has options.

She’s learning to set goals, weigh choices, make sacrifices, and bounce back. And I think we can all agree—those are lessons that stretch way beyond her wallet.

Final Thoughts

Kids don’t need complicated charts or crash courses in economics to learn about money. What they need is experience. A safe space to make decisions, feel the weight of them, and learn from them. Our system isn’t perfect, but it’s working. And more than anything, I’m proud of the smart, self-aware little human Eliana is becoming because of it.

Let’s Talk

Do you have an allowance system at home? How are you teaching your kids about money—and what’s worked (or not worked) for your family?

Also—do you remember the first time you learned the value of a dollar? I’d love to hear that story too. 💬👇

Love, Fabi