We pay each kid a fixed salary once a month (different depending on age). There are no conditions to the salary so we can't use it as leverage/punishment. After putting money aside for tithing, they can decide how much they want to go into "giving", "saving", or "spending." We encourage them to identify something "big" they are saving for. We give them presents/freebies on holidays and birthdays only. Our kids are still young (11, 8, 5) so we still provide them with basic needs like clothes, food, etc. and pay for their extra curricular activities (soccer, basketball, piano, etc.) Outside those, if they want something, they have to use their money to get it and, in general, we have to let them make the purchase. There are some prohibited items like saving for an iphone, laptop and some other things that we feel they are not ready to handle.

It has been interesting to watch them decide how much to save vs. spend. It has been good to have discussions with them about the cost of a particular item and if they really want it that bad. We recently stopped paying for soda when we go out to eat as a family. If they want soda, they have to pay for it. It's been interesting to watch the different approach by each kid.

We expect this to evolve significantly as the kids age. At some point we will probably significantly increase the salary but not pay for clothes, phone bill, etc. Hopefully, they are learning about value and budgeting.

Pros and cons and I'm sure some will think we are doing it wrong. It has taken significant effort and discipline to implement. My wife's love language is gift giving so you can imagine the battles there and how hard it is for her. We are not perfectly living within the system but hope we are helping them get a feel for it.