We have tried several reward systems, including rejigging the rewards and earning rules numerous times. But both us and the kids would frequently forget to award them. Then the kids would remember after 2 or 3 months and it would become a headache to try to assess.

So we’ve switched to debit cards with automatic allowance transfers. There’s also an option with the system we use to reward extra money for weekly chores, all done via the mobile app. It’s very convenient. Not least because the kids usually forget to do their chores, so they rarely earn the extra $s.

Additionally, the kids usually forget about their accounts/cards (despite frequently complaining when we say no to requests for treats or extra things). So their modest weekly allowances are gradually building up to a decent little nestegg.

But yeah, I hear ya about the concern about kids having debit cards too young. There has to be a certain level of financial awareness to really cope with them. Though the counterpoint to that is: such a mechanism helps get them to that better awareness.

Edit: fixed some autocorrect errors.

I give them money for doing things and in return, they get things. I advise them on spending but don’t force it. This way they are free to use their money but also learn effectively over time. If you force their decision, or override their decision, you effectively eliminate the learning.

We do Greenlight for this, which has a management app and a debit card. It’s not perfect, but it’s working well for our preteen son and is pretty flexible. We can add money when he completes chores and can partition what he can spend where. It works and he’s definitely gaining more of an understanding of how to manage his money.

Edit - Greenlight also gives you a qr code and payment link that (e.g.) his grandmother can use to pay him for mowing her yard, etc. No cash involved.

Eh, we have a budget program in the house for learning skills, that are then used to help decision making when the kid has funds.

There isn’t an allowance. We buy the stuff based on circumstances. Cash isn’t as ideal as it used to be. Cards, be they gift, prepaid debit, or bank related, come with drawbacks that make them unattractive for the purpose of the kid being able to have their own funds.

They have a real budget and the educational one. The educational one is set up based on their efforts. Originally it was scaled, where it was a set amount every month, they’d have set prices for the basic items of life like rent and utilities but win those amounts representing a percentage rather than actual prices.

Then, as they mastered that, it to realistic numbers, taken straight from our actual bills, with their income factored by their school work and household responsibilities.

The only time the real budget, where they have an amount they can request be spent on their behalf that can roll over and be saved (up to a point, it puts a crimp in other things if it builds up too much) is if they decide to skip obligations, to go into debt, or otherwise do something that would screw their budget if it were real. When that happens, the real budget gets frozen until the educational one gets balanced again.

What they don’t know is that they have an account for when they get older that any of that amount that can’t be held in our accounts gets deposited to. Same when they make bad decisions in budgeting and it gets frozen.

It’s as close as we can get it to simulate adult life without being a horrible grind, or taking agency away, which leads to no learning by making mistakes.

They’ve gotten pretty good at making good decisions. And I mean by the standards of their situation. It isn’t all spent on stuff you might value as an adult. There’s music and crap food, and outings, whatever. But they make the decisions consciously, choosing to spend their budget on self care in those ways, which is a perfectly valid choice even for adults.

Not that that’s the only money that gets spent on such things. We’re fixed income, but they have a say in the tiny household entertainment budget, and have times when they plan the meals, etc. But that’s different from discretionary spending the way allowances were, and the way their personal budget is. Them picking a shitty movie to go to on the rare times we go out to movies, that’s not their allowance equivalent, that’s them taking their turn picking the movie. If they want a different trip out the next week, it would have to come from their discretionary budget instead of the household entertainment/fun budget.

It wouldn’t work for everyone. But it works for us.

Our oldest is only 4 years old but when there is a flea market or a street market we give him some money he can use to buy stuff. This way he learns that he can’t buy everything he sees and has to set priorities.

We still pay allowance in cash for our preteen. It gets divided into save, give and spend. If there’s something she wants purchased online, she pays us the cash and we order it with our card. If the purchase is going to take most/all of her current spending money we do point that out but don’t prevent her from spending it.

I’m not sure yet what we’ll do when she gets closer to driving age. Most likely get a debit card so she can get that experience before going out on her own after graduation. But for now we want to build a more solid connection of physically parting with the money when it’s spent.

edit: fixed autocorrect error

We’ve had a box that comes in three segments. Each has a label: Save, Give, and Spend. Easy to find online.

The weekly cash allowance, as well as family and holiday gifts all go in there, split into portions. The spend section typically gets used when hanging out with friends or after sports practice. Usually candy or junk food. If going on a planned field trip or a group gathering with friends, we throw in some extra funds ($5-$20) so they can get food, snacks, or treat a friend. Nothing is digital or credit based.

When the Save or Give sections get full, kid gets to pick a charity (‘Give’) or we walk down to the bank to deposit the ‘Save’ cash into a kid’s saving account with no monthly fee.

It’s worked pretty well so far.