Clothing allowance for teenager

[aricia]

Instead of buying clothes for my 15 year old daughter, I would like to transition her to a clothing allowance where I give her a set amount and she is responsible for her clothes and shoes, plus makeup and other random wants. I’m not sure how much I’m spending now though! Any thoughts on what amount would be appropriate?
A lot of her clothes come from Kohls and TJ Maxx, with a couple pairs of American Eagle jeans or so thrown in, nothing very expensive. We live in a small town and local shopping options are limited. If she wants full price Nike stuff or Lululemon, that is usually a birthday/Christmas gift or she pays for it with her gift money. She doesn’t work and doesn’t get any type of allowance currently.

[Sharon]

Could you do this in incremental steps?  That way you could both transition, she could be come more responsible and you could figure out an appropriate amount.  What I mean is maybe just start off with her being responsible for her make up, then maybe add in shoes etc.

[aricia]

She actually already buys her own makeup. That’s basically just concealer and mascara. I’d prefer to just switch her over all at once and be done with it! I should have started tracking her clothing expenses so I would have a better idea. 😔
She’s pretty responsible. I doubt she’ll blow through her money, more likely she’ll be wearing rags because she doesn’t want to spend it. I will definitely help her out for a while. I have to drive her to take her shopping at this point anyways. I’m hoping to have her be more independent, in her spending and her lifestyle, by next summer when she’ll be able to drive.

[Knee Deep in Water Chloe]

I did the incremental steps starting with freshman year. IIRC (she’s 22 now), we did this:
—I gave her a $30/month clothing allowance
—she had several other ways of earning money
—I paid for undergarments the entire time.
—freshman year, she had to pay for her own make-up
—sophomore year she had to pay for shoes
—junior year she had to pay for regular clothes (not dress clothes that I required for etiquette purposes)

[minnesotapaintlady]

This would so not have worked with either of my boys.  They would forego new clothing entirely to use the money for video games.  They would have duct taped shoes and clothes two sizes too small with stains and holes and the school would send them home because they don't meet code.

[ArchietheDragon]

$100 bucks a month.  That wouldn't include winter coat/boots/gear or anything needed for formal wear, etc. 

[billisonboard]

What amount are you willing and able to allocate for her spending based on your income and expenses? How will it be disbursed to her? One annual amount seems like it could be overwhelming to a 15 year old but a flat monthly doesn't cover typical clothes spending like a back to school shopping trip. Also along this line will she have a ledger, her own bank account with deposits made, or cash?

Doing this "right" will require a lot of detail thinking that is a challenge for others to cover in this message board format.

[Tennesseer]

Jul 2, 2024 9:20:23 GMT -5 aricia said:

Instead of buying clothes for my 15 year old daughter, I would like to transition her to a clothing allowance where I give her a set amount and she is responsible for her clothes and shoes, plus makeup and other random wants. I’m not sure how much I’m spending now though! Any thoughts on what amount would be appropriate?
A lot of her clothes come from Kohls and TJ Maxx, with a couple pairs of American Eagle jeans or so thrown in, nothing very expensive. We live in a small town and local shopping options are limited. If she wants full price Nike stuff or Lululemon, that is usually a birthday/Christmas gift or she pays for it with her gift money. She doesn’t work and doesn’t get any type of allowance currently.

Is it safe to assume you have already told your daughter about a clothing allowance? How about for the months of July and August, you ask her to note everything down on what she spends each month on clothing and makeup. Then come September when school starts, start with the clothing allowance based upon the July and August data. This future allowance is minus more expensive clothing like winter overcoats and stuff like that.

[aricia]

Knee Deep in Water Chloe - Good idea on the undergarments!


minnesotapaintlady - yeeeaaahh, I will definitely set expectations that this money in contingent on her maintaining an appropriate wardrobe.  Most of her own money that she splurges now goes to clothes and shoes anyways, so I think it'll be okay.  She will more likely not spend it at all and I can always nudge her in the right direction.


ArchietheDragon - $100 a month is around what I was thinking.  Maybe as low as $85.  I do see several of you exclude dress clothes though and I'm not sure how I feel about that.  I was thinking she'd be responsible for those too and I would give her a heads up if she needed something in particular, which would be rare.  I'll pay for her winter coat since the one I bought last year was worn approximately twice and should therefore last forever, right?  She's definitely in the anti-coat camp!


billisonboard - I am willing to give her an amount that allows her to maintain approximately the same wardrobe that she's had.  We live well below our means.  If she screws this up, I will make HER feel the pain but it won't really matter to our family finances.  I think I'll pay her monthly but be willing to give her an advance if needed, like back to school.  I think we'll do a ledger where she'll have to write down the store and approximate clothing items purchased and amount spent.  She'll have to file her receipts.  That way if she looks like she's being reasonable and it's just not enough I can give her more, or help her understand where she overspent.  I'll let her use an authorized user card for a credit card that I don't use much and reconcile it with the ledger.  I'll let her withdraw cash if needed.  I think keeping it as a ledger will keep it separate from her other money in her mind and make it easier for her to spend on clothing.  Plus, I'd rather she wasn't dragging around a bunch of cash.  I've given her the credit card before when she's been out of town with friends or school and she has been completely 100% responsible with it.  I get a text every time she uses it.


Tennesseer - Yes, I have talked to DD.  We did track for June ($39).  She starts school the beginning of August.  Her clothing expenses are pretty lumpy so I don't think I can use that to set the budget but I was going to give her the excess for June to start to start her off.

[Pink Cashmere]

When I started something similar with my teenagers, it wasn’t a monthly amount for clothes. For example, when I took them shopping for back to school clothes, I told them how much money they each could spend for clothes and shoes. They could buy whatever they wanted, but that was it for back to school clothes. 

DD immediately became a bargain hunter and would go straight to clearance racks. I let DS make some mistakes by splurging unnecessarily and then having to live with his choices because I was serious about his budget. When I knew he was making a bad decision, I’d ask him are you sure you want to pay that much for that, you only have x amount of money and you still need other stuff. He would insist, and I would buy it. Then he would get upset when he ran out of money and I wouldn’t give him more. He did that twice I think, before he learned that I was serious and wouldn’t change my mind and give him more money, no matter how much he pleaded his case or how many fits he had.

The money I allowed them to spend was around what I would’ve spent overallanyway, my goal was to help them learn something about making wise choices with the amount of money you have available to spend. Plus, I didn’t have to actively shop for them anymore, I could just sit down near the fitting rooms and wait to see what they chose when they tried it on. I hate shopping lol.

I did the same thing when it was time to buy clothes for winter, or whenever they needed new clothes, gave them each a budget and let them make their own choices. I didn’t just hand them the money though, I took them shopping and just paid for their stuff and told them how much money they had left. I took them to as many stores as necessary, just like I’d always done.

I still bought other things like winter coats and necessities, that’s just how I handled their clothing and shoes.

[aricia]

Jul 2, 2024 14:27:29 GMT -5 Pink Cashmere said:

When I started something similar with my teenagers, it wasn’t a monthly amount for clothes. For example, when I took them shopping for back to school clothes, I told them how much money they each could spend for clothes and shoes. They could buy whatever they wanted, but that was it for back to school clothes. 

DD immediately became a bargain hunter and would go straight to clearance racks. I let DS make some mistakes by splurging unnecessarily and then having to live with his choices because I was serious about his budget. When I knew he was making a bad decision, I’d ask him are you sure you want to pay that much for that, you only have x amount of money and you still need other stuff. He would insist, and I would buy it. Then he would get upset when he ran out of money and I wouldn’t give him more. He did that twice I think, before he learned that I was serious and wouldn’t change my mind and give him more money, no matter how much he pleaded his case or how many fits he had.

The money I allowed them to spend was around what I would’ve spent overallanyway, my goal was to help them learn something about making wise choices with the amount of money you have available to spend. Plus, I didn’t have to actively shop for them anymore, I could just sit down near the fitting rooms and wait to see what they chose when they tried it on. I hate shopping lol.

I did the same thing when it was time to buy clothes for winter, or whenever they needed new clothes, gave them each a budget and let them make their own choices. I didn’t just hand them the money though, I took them shopping and just paid for their stuff and told them how much money they had left. I took them to as many stores as necessary, just like I’d always done.

I still bought other things like winter coats and necessities, that’s just how I handled their clothing and shoes.

Yes, it seems like this should work and we tried it last year and…. It didn’t. This was pretty much how my parents handled it for me, too. With DD, she is SO finicky and SUCH a deal hunter that we can easily go shopping and come back empty handed. Or buy all her summer clothes in November. And since we live in a small town, sometimes we end up shopping in “the big city” at weird times, like when we’re visiting family. I don’t know exactly why but it didn’t seem to work and just dragged on forever with her never wanting to spend the money because she might find something better later. Also, she loves buying stuff and then returning it, grrrrr. Part of this new arrangement is so that once she’s driving, she can deal with making her own returns and if she screws up and forgets, oh well! (Because, yes, I have forgotten to make HER returns and then feel bad penalizing her for that.)

[aricia]

She has had a little bit of experience budgeting her money for clothing because I refuse to buy her certain clothes that I deem unnecessary and she usually has a kohls gift card from family. She’ll only use it in things that are like $3 on the clearance rack. Or I have to convince her that it’s a super great deal, I’m just not buying it.

[billisonboard]

Jul 2, 2024 15:03:01 GMT -5 aricia said:

Jul 2, 2024 14:27:29 GMT -5 Pink Cashmere said:

When I started something similar with my teenagers, it wasn’t a monthly amount for clothes. For example, when I took them shopping for back to school clothes, I told them how much money they each could spend for clothes and shoes. They could buy whatever they wanted, but that was it for back to school clothes. 

DD immediately became a bargain hunter and would go straight to clearance racks. I let DS make some mistakes by splurging unnecessarily and then having to live with his choices because I was serious about his budget. When I knew he was making a bad decision, I’d ask him are you sure you want to pay that much for that, you only have x amount of money and you still need other stuff. He would insist, and I would buy it. Then he would get upset when he ran out of money and I wouldn’t give him more. He did that twice I think, before he learned that I was serious and wouldn’t change my mind and give him more money, no matter how much he pleaded his case or how many fits he had.

The money I allowed them to spend was around what I would’ve spent overallanyway, my goal was to help them learn something about making wise choices with the amount of money you have available to spend. Plus, I didn’t have to actively shop for them anymore, I could just sit down near the fitting rooms and wait to see what they chose when they tried it on. I hate shopping lol.

I did the same thing when it was time to buy clothes for winter, or whenever they needed new clothes, gave them each a budget and let them make their own choices. I didn’t just hand them the money though, I took them shopping and just paid for their stuff and told them how much money they had left. I took them to as many stores as necessary, just like I’d always done.

I still bought other things like winter coats and necessities, that’s just how I handled their clothing and shoes.

Yes, it seems like this should work and we tried it last year and…. It didn’t. This was pretty much how my parents handled it for me, too. With DD, she is SO finicky and SUCH a deal hunter that we can easily go shopping and come back empty handed. Or buy all her summer clothes in November. And since we live in a small town, sometimes we end up shopping in “the big city” at weird times, like when we’re visiting family. I don’t know exactly why but it didn’t seem to work and just dragged on forever with her never wanting to spend the money because she might find something better later. Also, she loves buying stuff and then returning it, grrrrr. Part of this new arrangement is so that once she’s driving, she can deal with making her own returns and if she screws up and forgets, oh well! (Because, yes, I have forgotten to make HER returns and then feel bad penalizing her for that.)

If she doesn't get new clothes, what is the issue? Did the bolded result in her going to school naked?

[aricia]

The issue is that I’m tired of constantly negotiating with her what I will buy. If she can maintain a decent wardrobe from whatever she already has or buying way less than her budget, that’s fine with me.

[aricia]

The other issue is she now wants Lululemon and $80 Nike sweatshirts and that’s pretty much a “no” from me. So if she can figure it out on a budget, fine.

[NastyWoman]

Many, many moons ago I did this with DS1 (he is 46yo now). We discussed this beforehand and I told him that I expected him to become responsible for everything clothing related with the exception of formal wear for prom and shoes. The shoes were taken out of the equation because even today finding size 13 shoes in Singapore is very tough and people have since  become a lot taller there on average. I told him his budget and that he could buy whatever clothes he wanted (I did want to see receipts so no danger of video games spending). What was leftover was his to keep for the next period to spend. Kiddo had expensive tastes so he spend his three month allowance in tbe first week. And then came month two - holes in socks and underwear (yikes, gym class) - and mom would not budge, no extra money and no advance. He got to deal with it all by himself at 14yo.

Let me tell you, it was a wonderful learning experience and he never did that again. It was his first experience at budgeting and he proved himself to be a fast learner.

[geenamercile]

My girls have never been big shopping for cloths.  Like MLP if I did a monthly budget for them it would end up being saved more then spent.  We normally do back to school shopping.  For that I tend to give 400 per kid, we also normally do a winter fill in around Jan, and summer fill in around June.  The fill ins are normally around 200 a kid.  So lets say around 800 a year, I am going to round that up to 1000.  1000/12 is 83.3333....... so I think 85 dollars a month would work, maybe a 100 if you want to add in make up and stuff too.  Both my girls do get like a 60 month allowance already, and don't spend it all.     

[aricia]

Jul 2, 2024 16:09:08 GMT -5 geenamercile said:

My girls have never been big shopping for cloths.  Like MLP if I did a monthly budget for them it would end up being saved more then spent.  We normally do back to school shopping.  For that I tend to give 400 per kid, we also normally do a winter fill in around Jan, and summer fill in around June.  The fill ins are normally around 200 a kid.  So lets say around 800 a year, I am going to round that up to 1000.  1000/12 is 83.3333....... so I think 85 dollars a month would work, maybe a 100 if you want to add in make up and stuff too.  Both my girls do get like a 60 month allowance already, and don't spend it all.     

Thanks! This is helpful. If I go to $100 a month I was hoping it could also be part regular allowance. Since she entered high school there’s more little things I end up giving her money for, like team building outings for her sport. I would like to turn over responsibility for those things to her as well.

[The Walk of the Penguin Mich]

A friend of mine did this with her 14 year old daughter.  It was at the beginning of the school year and she gave her daughter $300 (what she would have spent….this was about 20 years ago) and a list of clothing she needed.  On the list, she had to get a winter coat, new gym shoes, underwear, socks and bras and school clothes.  I guess school shopping was a huge battle of wants vs necessities and mom didn’t have the stomach to do battle again.

Daughter went shopping and came home with 3 new pair of full priced jeans.  By the time Christmas came around, daughter was still wearing her new jeans, but last seasons too tight, used up holey clothes.   Her Christmas presents that year were underwear, socks, bras and a winter coat (old coat the sleeves were half up her arms).  Daughter got another $150 to get spring clothes, and apparently she learned her lesson and started haunting TJMax and Ross.  

[Pink Cashmere]

Jul 2, 2024 15:03:01 GMT -5 aricia said:

Jul 2, 2024 14:27:29 GMT -5 Pink Cashmere said:

When I started something similar with my teenagers, it wasn’t a monthly amount for clothes. For example, when I took them shopping for back to school clothes, I told them how much money they each could spend for clothes and shoes. They could buy whatever they wanted, but that was it for back to school clothes. 

DD immediately became a bargain hunter and would go straight to clearance racks. I let DS make some mistakes by splurging unnecessarily and then having to live with his choices because I was serious about his budget. When I knew he was making a bad decision, I’d ask him are you sure you want to pay that much for that, you only have x amount of money and you still need other stuff. He would insist, and I would buy it. Then he would get upset when he ran out of money and I wouldn’t give him more. He did that twice I think, before he learned that I was serious and wouldn’t change my mind and give him more money, no matter how much he pleaded his case or how many fits he had.

The money I allowed them to spend was around what I would’ve spent overallanyway, my goal was to help them learn something about making wise choices with the amount of money you have available to spend. Plus, I didn’t have to actively shop for them anymore, I could just sit down near the fitting rooms and wait to see what they chose when they tried it on. I hate shopping lol.

I did the same thing when it was time to buy clothes for winter, or whenever they needed new clothes, gave them each a budget and let them make their own choices. I didn’t just hand them the money though, I took them shopping and just paid for their stuff and told them how much money they had left. I took them to as many stores as necessary, just like I’d always done.

I still bought other things like winter coats and necessities, that’s just how I handled their clothing and shoes.

Yes, it seems like this should work and we tried it last year and…. It didn’t. This was pretty much how my parents handled it for me, too. With DD, she is SO finicky and SUCH a deal hunter that we can easily go shopping and come back empty handed. Or buy all her summer clothes in November. And since we live in a small town, sometimes we end up shopping in “the big city” at weird times, like when we’re visiting family. I don’t know exactly why but it didn’t seem to work and just dragged on forever with her never wanting to spend the money because she might find something better later. Also, she loves buying stuff and then returning it, grrrrr. Part of this new arrangement is so that once she’s driving, she can deal with making her own returns and if she screws up and forgets, oh well! (Because, yes, I have forgotten to make HER returns and then feel bad penalizing her for that.)

Hmmmm, well my children and I had access to a reasonable amount of shopping options where we lived, even if that meant I drove 30 or 40 minutes to the newest malls and the stores near them. But that’s something I occasionally did anyway, so I didn’t just stop doing it when I started giving them a budget for their clothing. 

But that meant that while I was willing to drive that far when it was time to shop for clothes, you better figure it out, because I wasn’t going to keep doing all of that driving any more than I would have before I’d started with the budget thing. That was the mindset I had when I’d be shopping for something for myself, so I didn’t feel bad about it. 

Our budgeted shopping trips included when they’d outgrown the summer clothes they wore the previous year, or casual/dressy clothes they could wear outside of school, that they had outgrown. But it was only so much running around I was willing to do for any of it. Like, no more than I would’ve done when I was making the choices for them.

[aricia]

Jul 2, 2024 17:16:25 GMT -5 Pink Cashmere said:

Hmmmm, well my children and I had access to a reasonable amount of shopping options where we lived, even if that meant I drove 30 or 40 minutes to the newest malls and the stores near them. But that’s something I occasionally did anyway, so I didn’t just stop doing it when I started giving them a budget for their clothing. 

But that meant that while I was willing to drive that far when it was time to shop for clothes, you better figure it out, because I wasn’t going to keep doing all of that driving any more than I would have before I’d started with the budget thing. That was the mindset I had when I’d be shopping for something for myself, so I didn’t feel bad about it. 

Our budgeted shopping trips included when they’d outgrown the summer clothes they wore the previous year, or casual/dressy clothes they could wear outside of school, that they had outgrown. But it was only so much running around I was willing to do for any of it. Like, no more than I would’ve done when I was making the choices for them.

That sounds amazing and I feel like you are an awesome parent! I have probably spoiled her to some degree by not forcing her to make a decision on clothes in a single shopping trip and live with it. When she was in 2nd grade, I bought her clothes she claimed she liked, only to have her refuse to wear them. I refused to buy new ones and she is stubborn and spent an entire school year wearing odds and ends, instead of ANY of the new pants. I think some of the shirts were ok, lol. I think we both lost that battle. Her sister got some really nice hand me downs that she wore with no issues. So since then I have really tried to encourage her to pick things she -actually- likes (and is willing to wear) and that takes her forever.
Nearest mall is about an hour away. I won’t make extra trips for her, but she won’t pick out every thing she needs in one trip. So we end up shopping around town repeatedly. She’s tall and thin, buying her jeans has been a nightmare ever since 2nd grade!

[azucena]

Can you look at Cc statements for the stores that are mostly hers from July last yr til now? This would give you monthly avg. Or heck, set her up to do it.

Has she tried teen specific resale shops like plato's closet? Dd15 loves shopping there to stretch her money. Plus she's learned it doesn't suck as much if she ends up hating something if it was <$10. She's just starting to like clothes shopping and working on her style.

Helps that she's grew early and has been roughly the same size for about 2 yrs so we are at wardrobe maintenance mode.

I've landed at $50 biweekly auto transfer to dd15 and bonus teen on my Fri paydays. Set it and forget it. Plus they've taken to high fiving me on our shared payday lol. Both are thrifty shoppers so this seems to be working.

I'm upfront with them of hey we are trying this and let's each speak up if it's not working.

We've outlined that I'll cover more costly necessary indiv items that are >$50 each like winter coat and a pair of new tennis shoes about every six months. Bras, underwear, socks and routine toiletries are also on me.

For lumpy spending, dd15 will speak up with a plan of hey I'm going to outlet mall with friends I spend more will you advance me which is usually an easy yes but rarely does she spend enough to end up needing advance.

Both teens have their own debit card which I think makes them more responsible than credit card access. Neither are spenders so i started them out at $100 opening balance and said now make it your goal to keep balance $100+ so it acts like practice emergency fund. Both are doing that well.

I think biweekly makes it naturally easier for them to budget. Monthly feels too long.

[azucena]

I should also mention that we originally started dd15 at $25 biweekly for her 15th b-day last July when she could get debit card. Our original agreement was that this should cover her misc spending which was mostly fast-food with friends about once a week. She was more into that at the time and not at all into shopping. Like I'd be begging for her to go with me to replace bras.

So I guess in our situation the $50×2 covers prior agreement and clothes.

One other thing to consider is how/if to pay for their friends. Dh and I both came from homes that could hardly ever hand us cash and we both fondly remember which friends moms would say no prob I got it this time. Since we are beyond fin stable, we agreed early on that we would be that type of parent. Dd15 has had certain friends thru the yrs that would have to say no to dinner or tickets or whatever even in the $20 range and she was pretty astute at watching us pay for them. Freshmen year she had a friend she knew struggled so she asked us for guidance on when we'd cover her and it worked well. That friend rolled off and was replaced by bonus teen last summer and dh and I both coached dd right away to cover teen quietly without a fuss. Within a month of that teen pulled dh and I aside to profusely thank us for giving her a more typical social life.

It's been interesting to watch bonus teen use her allowance. I can't tell if she's a spender or saver as it fluctuates and she's def never had pocket money. So trying to gently coach her. She's also very giving. One of her best friends lives with her grandma and doesn't have much. Teen immed started taking to paying for friends fast food so friend could go. So I made teen same deal, I'll always reimburse you for that friend within reason and text me if you need judgment call. That's been working well and probably adds another $50/summer month when they have more time lol. Helps that none of them can drive but that will change 7/31 for dd soon to be 16. In fact I should prob give them each that $50/month informal friend reimbursement cap.

[azucena]

Fwiw I typed all that not to brag but to say that I'm seeing this friend budget help both teens learn charitable giving skills. Particularly dd15 and she's noticed that it's not fair that $20 means some teens bow out while she herself has been blessed.

Oh and this translated to dd11 watching and learning and adapting to her own friends one of which is the middle of 6 kids with a said. We've had some important conversations about how their finances likely compare to ours and I've been able to share that my upbringing was much more like friends as I'm oldest of five supported by farming dad and sahm.

Dd11 already has the clothing bug and is eager to get started on this allowance thing so I have in mind to set her up for 12th bday 8/3 with $25 biweekly likely on a new debit card in my name. I keep wanting to start her in cash but need to give up bc that's just not realistic for us today. So far she's going to be my spender but she also already makes her own cash by dog sitting for $20/day. In the last two weeks she gave out 30 flyers as neighbor dogs were walked by.

[azucena]

Can I piggyback on this thread with a related question?

Dd15 has a part time job this summer. What are you all insisting your teens save from theirs? I'm thinking 50% for college fund. I also have an inkling to provide a dollar for dollar match for anything saved above 50% with a penalty if that part is withdrawn for something other than college. And tie it to 401k matching lesson and comparison. Thoughts?

[TheOtherMe]

In the dark ages, my parents made me save 50% of my high school jobs.  It was a good lesson in saving.  When I lived at home and paying miniscule rent and a car payment and nothing else as regular expenses, I was told to save 50% and I did.  

When I started working and had roommates, my rent share allowed me to continue saving about 30%.  

All of that saving meant I had a decent down payment on my first home.  

When I was in high school, mom took us on a back to school shopping trip for underwear and a few outfits.  On birthdays and Christmas there would be outfits.  Anything else I wanted, came out of earned money.

Back then, they had lay away programs at a lot of department stores.  That is how I would buy the clothes I wanted that mom wasn't buying.

I know life has changed and I don't think lay away is a thing any more.  

[geenamercile]

Jul 3, 2024 5:26:48 GMT -5 azucena said:

Can I piggyback on this thread with a related question?

Dd15 has a part time job this summer. What are you all insisting your teens save from theirs? I'm thinking 50% for college fund. I also have an inkling to provide a dollar for dollar match for anything saved above 50% with a penalty if that part is withdrawn for something other than college. And tie it to 401k matching lesson and comparison. Thoughts?

Can't help with that, apparently both of my daughters are natural savers, to the point on vacations I have to give them an allowance with the understanding they don't get to keep what they don't spend.  So very different then A's children.  They both do have a green dot card that the ex puts their allowance on.  

My only thought is don't make it to complicated.  

[ArchietheDragon]

Jul 3, 2024 5:26:48 GMT -5 azucena said:

Can I piggyback on this thread with a related question?

Dd15 has a part time job this summer. What are you all insisting your teens save from theirs? I'm thinking 50% for college fund. I also have an inkling to provide a dollar for dollar match for anything saved above 50% with a penalty if that part is withdrawn for something other than college. And tie it to 401k matching lesson and comparison. Thoughts?

50% seems like a lot to me.   "expert" advise is to save at least 10% of your income long term savings or 20% if you want to stretch it.   I wouldn't have them save more than that.   The actual dollars saved are not really going to move the needle and my concern would be that requiring a 50% savings rate would disincentive them for saving in the future.  I would ask them to save 10-20% for college and then let them make their mistakes and learn how to manage the rest.    

[billisonboard]

Jul 3, 2024 9:59:41 GMT -5 ArchietheDragon said:

Jul 3, 2024 5:26:48 GMT -5 azucena said:

Can I piggyback on this thread with a related question?

Dd15 has a part time job this summer. What are you all insisting your teens save from theirs? I'm thinking 50% for college fund. I also have an inkling to provide a dollar for dollar match for anything saved above 50% with a penalty if that part is withdrawn for something other than college. And tie it to 401k matching lesson and comparison. Thoughts?

50% seems like a lot to me.   "expert" advise is to save at least 10% of your income long term savings or 20% if you want to stretch it.   I wouldn't have them save more than that.   The actual dollars saved are not really going to move the needle and my concern would be that requiring a 50% savings rate would disincentive them for saving in the future.  I would ask them to save 10-20% for college and then let them make their mistakes and learn how to manage the rest.    

"Expert" advice on savings percentage also includes percentages for housing and a lot of adult expenses. Unless you are requiring rent payments, etc you are really warping spending habits if the kid is spending 90% of income on wants.

[ArchietheDragon]

Jul 3, 2024 10:14:35 GMT -5 billisonboard said:

Jul 3, 2024 9:59:41 GMT -5 ArchietheDragon said:

50% seems like a lot to me.   "expert" advise is to save at least 10% of your income long term savings or 20% if you want to stretch it.   I wouldn't have them save more than that.   The actual dollars saved are not really going to move the needle and my concern would be that requiring a 50% savings rate would disincentive them for saving in the future.  I would ask them to save 10-20% for college and then let them make their mistakes and learn how to manage the rest.    

"Expert" advice on savings percentage also includes percentages for housing and a lot of adult expenses. Unless you are requiring rent payments, etc you are really warping spending habits if the kid is spending 90% of income on wants.

warp away.