An allowance is money that you get from your parents.  Usually the money that you make is based on the things you do around the house, like taking out the garbage or cleaning your room.  Not many parents give an allowance for doing nothing.   Allowances are usually paid at the end of the week or at the end of a month.  The amount of money that you get for the chores you do might be decided by your parents or negotiated by you.  The amount of an allowance is usually the value to your parents of the chores you do.  Here’s an example:  A mother might offer her child an allowance of $5.00 per week for walking the dog and doing the dishes every night.  To her, this is the value of those two chores to her.  A father might offer his child $10.00 a week to have the car washed and the dog walked.  These chores have value to the father who would have to take a lot of his own time if he had to do them himself.  Some parents are open to something called negotiation.  Negotiation in this case would be a back and forth discussion between you and your parent of what chores would be done for $5.00 a week or what other chores could be substituted or added into the deal.  This is an “oral contract” between you and your parent.  When you agree on the chores and the amount you will be paid, then the responsibility is yours to actually DO the jobs. 
     Negotiation can be fun.  Let’s say that your mother offers you $5.00 a week to mow the lawn and clean your room.  The lawn is BIG and it takes you 3 hours to do it.  Cleaning your room ALWAYS takes about 2 hours a week.  You feel that you should be paid $7.00 for that amount of work.  You need to plan a negotiation strategy.  The first thing you do is sit back and think.  What does your mother hate to do?  What chore around the house gets her really upset when no one will do it?  Chores that your mother hates to do have real VALUE to her.  You might have room for negotiation if you offer to do something that will make her life a lot easier.  You decide that taking out the trash will take you about five minutes a night and that would balance the lawn mowing that takes so long.  So, you negotiate a new allowance based on your mowing the lawn, cleaning your room, and taking out the trash every night.  You might ask for $10.00 a week instead of $5.00 because of the length of time it takes to do the lawn and the addition of another chore.  Discuss the value of what you are offering to do and the reasons why the amount is fair and reasonable.   Each side should feel like the deal was okay for them.   The good thing about negotiation with your parents isn’t just that you get more money, but it is also a good place to learn this valuable skill.  Some day you will need to negotiate your salary with a boss and you will be so experienced by then!
     Another way to earn money is through something called wages.  When a boss pays you wages, he is calculating how many hours you worked or how much of something you produced.  Kids usually get hourly jobs like working at an ice cream shop or being a waitress/waiter.  When you get a job like this, the boss will tell you how much pay you will get per hour.  The United States minimum wage is $6.55 per hour.   Sometimes an employer doesn’t pay people minimum wage because they are kids or they are earning tip money.   Some people earn wages that are based on what they produce.  An example of this would be people who pick vegetables during the summer months.  They might be paid by the bushel.  You might get a job stuffing envelopes with sale flyers and be paid a certain price for each completed envelope.  When you get a job earning wages, your employer will subtract federal and state income taxes from it.  At the end of the year, you can sometimes get that money back by filing an income tax form with your state and the federal Internal Revenue Service.
     Most kids don’t get the third kind of earned money called a salary.  Adults usually earn salaries because they work full-time.  Because we are kids and need to go to school, we can’t work full-time.  When a person gets a salary, the employer will tell him/her how much money they will make that year.  Then the employer divides that money by how many times the worker will be paid during the year.  This gives them the amount of pay the employee should get before they take state and federal taxes from it.  Let’s imagine that you make a salary of $45,000 a year and get paid two times a month.  There are 52 weeks in a year but you are not going to be paid every week, or four times a month.  You are going to be paid half that much or two times a month.  So you take the 52 weeks, divide it in half, and end up with 26 payments a year (2 per month).  Divide the $45,000 by 26 and you would be paid $1730.77 twice a month.  You would not get this amount because taxes need to be subtracted.  The amount of your tax is based on forms you fill out when you get the job.
     No matter how you earn it, pay is based on a responsible, completed job. 

More Piggy Pages

Money game

Money matching game

Money crossword puzzle

Activities

Survey results

Our allowance questions

Fun Fact

Ancient Romans were given money to buy salt.  The word started to be used for the money itself and became 'salary'.