Guaranteed income, and fiscal responsibility experiment with our children's allowances
Something I enjoy about having a family is seeing how societal concepts can play out on a micro-scale. It’s the social scientist in me, combined with my desire to create positive alternatives to the social systems we live in. As a family unit, we are a group of individuals with independent goals, desires, and expectations. Furthermore, we have a relationship with each other and shared goals. This can be expanded to our neighborhood, community, state, country, and world. So, as a father and avid gardener, I nurture my daughters as sprouts that will grow and influence the forest they plant themselves in. Some concepts they have to have an understanding of are: money, its relationship to fulfilling responsibilities, and enjoying privileges. Money is part of society, we attempting to teach our kids to have a healthy understanding of the role money plays.
Previous ways we provided allowances for chores.
There are many ways to provide an allowance for your children, and we have tried a a few with varying results. For a time we would pay them a per chore wage of 50¢. Their chores would include: sweeping, emptying the dishwasher, setting the table, and folding towels. This evolved with a chalkboard chore chart. We designated five standard chores: feeding the dogs, helping make dinner, clean the living room, clean the dining room, and emptying the dish washer. We went through multiple variations of incentives and ways of assigning chores. They expected to do their assigned chore daily, and rotate each chore weekly. Having a choice of a day off. Dishes rotated based on oldest to youngest, and happened based on when the dishwasher ran. Then, they would take turns picking a chores individually. This allowed for them to choose to do multiple chores in one day, and have a couple days off.
If that was not complicated enough, the payment options became more and more complicated. First, each chore was worth one quarter. If they whined about doing it, they would not get paid, and we would make them do it anyway. We wanted them to understand that they needed to contribute to the responsibilities and tasks that are necessary to supporting family life. You know, prepare them for “real-life”. And, we wanted them to do it with a good attitude. Success is 90% attitude, and 10% aptitude. Or, so the meme goes something like that. We tried to incentivize attitude with a variety of payment schemes: as mentioned before, they only got paid for the individual chore if they did it without whining; then their per-chore-wage would double the next week if they did’t whine all week ($.50/per chore). We had a “whine-box” on the chore chart that would get checked if they whined. Are you having a hard time keeping track of the system, think about being six-years-old and making sense of this! And if that was not enough, I added another box that got checked if they completed their chores everyday of the week. This would add a bonus quarter to their following weeks per-chore wage. Yea, fun for me, and it drove lots of conversations about being responsible and the rewards that came from fulfilling your obligations. But, it was way too complicated to be sustainable, let alone get the results we were looking for.
The whole system got put on hold as we made our move to Walla Walla.
Stories of how other parents approached allowance
If you know how I gather information, you know I get a lot of my news and information from podcasts. You can see my top podcast recommendation on my resource page. There were a couple episodes I heard during the time we were evaluating how to restart our daughters allowances.
The first episode was on The Motley Fool:Answers podcast, the May 15th, 2018 episode. In this episode, the hosts discuss approaches to providing an allowance for their kids. They connected how the method of providing an allowance, with what one wants to teach their kids about money. The discussion was thought provoking, and started my thought process on how to restructure our allowance system.
ChooseFi, had an episode that I can not locate for the life of me. On the episode, the guest shared how they provide a basic allowance for their children. They require that the kids pay for many of the things they need, including school lunches and haircuts. They also require that each child chooses an organization to give to, and starts their budget by making that donation. The guest shared a story about how the kids learned to use coupons, and even ask the cashier if there were coupons available to inform their purchasing decisions.
As I write this post, Joe Pinsker of The Atlantic, published the article, “The Way American Parents Think About Chores Is Bizarre.” The article starts with a brief history of allowance, the infusion of apps to facilitate the exchange, a reference to proponents of per-chore-allowance, and then lays out the reasons to re-think this approach.
“In our society—and I’d extend this to most modern, post-industrial nations—we actually deny our children’s bids to help. We distract them with other activities, we do our chores (meal prep) when they’re napping, we convey that their ‘helping’ is burdensome and, not surprisingly, the helping instinct is extinguished. Hence, at 6 or 7 when we think they’re ready to start doing chores or at least taking care of themselves and their ‘stuff,’ they’ve lost all desire to help out.”- David Lancy, a former professor of anthropology at Utah State University
Examples of basic income at scale
Basic income is a social welfare program that citizens of a country would get a guaranteed minimum income. This is a major topic, and calls for dedicated posts in the future. Here are some resources and discussions to introduce the topic, and help you get more familiar with the concept.
A video from Fortune Magazine is included here that presents some aspects and reasons why we need to consider this idea. There are multiple examples of municipalities and governments testing and implementing basic income programs. In the United State: New Jersey, Seattle, Denver, North Carolina, Alaska, and more. Countries that have basic income programs include: Canada, France (since 1988), Cyprus (2013), and Kenya. Projects that are being ended appear to be ended for political reasons, and not because of earnest evaluation of the merits and short-comings.
There is an argument that this creates incentive for the unemployed to stay unemployed. There is another argument that there are systemic issues that need to be addressed, and programs like this can create a way to balance those systemic problems. One issue that can not be ignored is the automation of jobs by robots. When robots take the jobs people rely on for income, and simultaneously decrease the number of jobs available, people need something to to allow them to engage in society financially. Tech giants and political candidates are raising this issue. Elon Musk, Ray Kurzweil, Fortune Magazine, and 2020 presidential candidate - Andrew Yang.
Our implementation of basic guaranteed allowance
It is important to us that our daughters learn to find value in contributing to our family and the community. It is also important to me that they have the resources to enjoy the things they want to do, while contributing to the things they need to do. So, I wrote up an agreement to use to have the discussion with my daughters, and outline the purpose and expectations of their new guaranteed allowance. The agreement is available below as a Word document, if you would like to use it for your family. Here are the main points:
They will get a weekly allowance of $10, deposited into their savings account.
They will be responsible for paying for: apps, games, toys, candy, friends birthday gifts, a birthday gift for each sister, and a Christmas present for one sister, as well a pet food and supplies for their pets.
Finally, they were given an option to put any whole dollar amount of their $10 into their graduation savings account. For each $1 they put in, Jennifer and I would match that contribution.
There was one wrinkle in the implementation. I had hoped that we would be able to get debit cards for the girls to conduct their online transactions and shopping trips. What we discovered is that they can not get debit cards until they are 13. So, until then I take the receipts and make weekly transfers back to my account.
When we first implemented the basic income allowance, Jennifer and I encouraged the girls to make an offering at church. And, on occasion they did. More so when they discovered the hot chocolate machine, and we told them they had to make a $1 donation if they wanted to get a hot chocolate. This did not really capture the concept of giving back. This week, Jennifer and I found a solution that better fulfills this need, and the girls were happy to contribute to. Our church, Blue Mountain Community Church, has been participating in Children of Promise. There are three ways we could contribute: sponsor a child, buy a mosquito net, or bring in our change to add to the penny drive. Sponsoring a child made the most sense to have the girls engage in regular giving. At 10%, they each will give $1 per week. This adds to $16, and is half of the monthly sponsorship.
After service yesterday, I brought Zoë to the table outside of the sanctuary and asked her to choose a child that we would sponsor. At dinner last night, I brought the brochure with our child’s picture on it. “Everyone, I would like you to meet your new sister.” I proclaimed. They were all excited, and I explained what we were doing, and what was being asked of them. Zoë read the description of our new child. She is in the 3rd grade, and has a brother. Her father works, and her mother is a home maker. They live on $150 a month. We talked about him much they are getting in allowance, and asked to think how that would be if that is all the money they had to eat for a whole month.
What ways do you teach your children about money? What do you want them to learn? Thank you for joining me on my journey. I hope you found value in the attempts we made, and the lessons we learned. It would be great to hear what you are doing or thinking in the comments below.