Guest Blog Post: I had my wife, Angie, write the blog this month. She and I work together on our family allowance, but I like her simple explanation of our system and thought you would all enjoy hearing from someone else for a change. 

We’ve received questions lately about how John and I handle allowance in our family and I thought it would be most expedient if I typed it out in a blog post to share with everyone. I welcome any questions or feedback.

First, our method is not really “our method.” We stole it from Jesse Meachem (founder of the YNAB app and platform) after reading his book, YNAB: You Need A Budget. In any sustainable allowance system, the parents need to be in sync. John and I use the YNAB app/platform on our cell phones both to make sure we are on track with our budget, and as a communication tool. We recommend it to everyone. Because John’s firm is fee-only, we do not participate in their referral program or accept compensation for referring their product; we simply recommend it because we believe in it. Learn more at:

Now… back to our allowance. It’s important to note that our girls are ages 11, 8, and 6. Every month, each child gets 3x’s their age as an allowance. So currently, we pay out $33, $24, and $18 respectively each month. Each of our children has their own YNAB budget in our family account, and John has a meeting with them each month to talk about how much money they have available in each category. They are required to allocate 50% of their allowance to savings, 40% to spending, and 10% to tithing. That last part is emphasized: all treasures are a gift from God and 10% of gross income is always returned to His church or a vetted non-profit doing His work.

What do we expect from their savings category? We expect that one day when they reach an age where they can purchase large items, such as a cell phone or car, they will either fully or partially fund it with their savings. The savings account is spent only after receiving parent permission, and we believe it’s important for them to have some skin in the game on major purchases. It should hurt just a bit to see their bank account depleted and we want them to feel the pride of ownership one feels when you purchase something yourself. In order to help them grow their savings, we have opted to invest the money in a S&P 500 fund inside of an UTMA (Uniform Transfer Minor Account).

What do we expect from their spending account? Loads of mistakes. Making mistakes are so integral to a child learning and growing to become a mature adult that we turn over 40% of their allowance purely so they can screw up with it. Initially, in the excitement of the new allowance, one of our children blew the entire spending amount on thinking putty and a pencil bag. She loved the thinking putty, but quickly misplaced it; and the pencil bag has lost its luster. At one time, after seeing it online, she thought it was THE BEST PENCIL BAG and just had to have it. She has learned that placing such value on an object like that doesn’t really do for you what you thought it would… Has anyone ever wanted just the perfect boots, skirt, or dress only to realize you aren’t more beautiful just because you have them, and wished you hadn’t spent the money? She is learning that early.

We have also tied the spending account to snacks in the lunchroom at school. We have agreed to purchase each child one snack per week with our own funds ($0.65/ea.) but if they buy more than that, they have to pay us back from their spending account. Initially, one of our children was providing snacks for her whole table in the lunchroom, but then she saw how much she spent and felt the pain of “I wish I hadn’t done that.” Now, she practices restraint and gets one snack a week because she doesn’t want to pay for it. In the beginning, I felt terrible for restricting snacks like this… after all its not that much money. She has learned such a valuable lesson, though, that I am now glad we did it.

One other key point- we do not tie allowance to household chores. First, we don’t have time to manage that. Second, we want the girls to see that they must contribute in our family by keeping their rooms picked up, helping around the house, and sorting/putting the laundry away just by virtue of being part of a family. We have natural consequences for not completing chores- no screen time or playing until the work is done, no stuffed animal at bedtime if your laundry isn’t picked up, etc.

What is the goal of our allowance system? Basically, many adults struggle with money due to lack of financial maturity and it truly holds them back from living the life they want to live. We want an item, so we buy it immediately without any regard to our budget or future consequences. Can we buy that car that is way beyond our means and still afford the monthly payments? Sure. But what does that do to how much is available to save for retirement, or college for your kids? Many of us spend too much time focusing on the “BEST PENCIL BAG EVER” and not enough time focusing on how that pencil bag will affect our financial picture. We aren’t saying this to indict anyone or cause anger, but it’s sort of become an American truth that we deserve all the things we want in life. You sure do deserve all that you want, but there’s a way to get it prudently and in a way that keeps your stress level/dignity in check. We want to raise our girls to be independent, financially mature women and we want them to understand financial decision making long before they are making mistakes in the real world.

John P. Chladek, MBA, CFP® is the President of Chladek Wealth Management, LLC, a fee-only financial advisor with a fresh approach to financial planning and investment management. Committed to busy professionals and entrepreneurs in Kansas City. For more information, visit