Average American Kid's Allowance: Ipad, 3 Kindles and More!
NEW YORK (BankingMyWay) -- Despite a sour economy, Americans parents still fork over a healthy sum for their kids' allowance, and virtually all of that money is spent and not saved.
According to data from the New York City-based American Institute of CPAs, the average American family gives $780 to each child for an allowance, or as the AICPA puts it, "enough to buy an iPad and three Kindles and still have money left over."
U.S. parents also are more than willing to pay for good grades. The AICPA says that the average pay for an "A" grade is $16.60.
But all this cash is evidently burning a hole in kids' pockets. The data say 99% of all allowance or grade money handed over to a child is spent, and only 1% is saved.
Some other figures from the AICPA on parents, kids and allowances:
The AICPA says parents could do a better job advising their kids on money and personal finances -- they say there has to be some level of accountability in getting an allowance that goes beyond taking out the trash or mowing the lawn.
"These findings make clear that it can pay to be a kid," says Jordan Amin, chairman of the AICPA's National CPA Financial Literacy Commission. "Parents need to make sure they're also passing along financial sense with those dollars and cents. Earning, budgeting and saving are all important lessons that can be tied to allowances -- lessons that can help put children on solid financial footing."
How can parents upgrade the allowance experience for their kids and make them more aware of good personal financial management?
The AICPA advises starting by setting parameters. "If you decide to pay an allowance, make sure your children clearly understand why they are getting it, how to earn it and how to lose it," the AICPA advises.
The group says parents should set a base allowance and provide "bonuses" for good attitudes and better grades at school. The important takeaway for kids is that the money is earned.