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A family close to me has suffered an unexpected loss of income. The hours at the breadwinner's job (one spouse works, the other does not) has been cut in half, so he has lost half of his income. The job might go away altogether in another month or so.
Two questions have come up:
1) Should the breadwinner take on temporary jobs to replace the lost income due to the paycut? Or is it appropriate to expand time spent on fun recreational activities and not worry about the loss of half of his income.
2) Should the children's allowance be cut in half or cut off altogether? Or, since the lack of income is no fault of the child, should the parents continue paying full allowance to the children?
If he/she can get another job, why not?, unless the family can still live comfortably on half of what they once pulled in...as for allowance, maybe it could be a little less , or better still, the kids could help out others for money...how old are the children?.
I never got an allowance as a kid. It's a weird concept. There are other ways for kids to have their own money, such as mowing the neighbors' yards, paper routes (do those still exist?), or any other "self-employment" options. Motivated kids do these things all the time.
Allowance is different in intent from money for chores or money from self-employment.
We used the kids allowance as a way to teach them to manage money. It was a very small amount, but before they earned money from chores, it helped them to learn how to save up for bigger toys they wanted and they could use it for candy or stuff we would normally not buy for them. It gave them some control over things. And this way, they were not asking for money for every little thing.
A family close to me has suffered an unexpected loss of income. The hours at the breadwinner's job (one spouse works, the other does not) has been cut in half, so he has lost half of his income. The job might go away altogether in another month or so.
Two questions have come up:
1) Should the breadwinner take on temporary jobs to replace the lost income due to the paycut? Or is it appropriate to expand time spent on fun recreational activities and not worry about the loss of half of his income.
2) Should the children's allowance be cut in half or cut off altogether? Or, since the lack of income is no fault of the child, should the parents continue paying full allowance to the children?
1) I think the answer to this one is pretty obvious... than again maybe not. We currently have a Disney trip coming up in the next couple months. It is paid for in full. If I lost my job tomorrow, we'd still go on the trip. We would not, however, go out to dinner or to the movies until the income was replaced.
Cut the children's allowance entirely. (Good lesson about reality for them. Also a lesson on how to cut back when something like this happens.)
And also cut out all other unnecessary expenses like paid TV, going out to eat, etc. If the breadwinner gets another job, THEN start spending again...
And plan for the worst right now. If the kids are old enough, see if they can do some part-time work after school or on weekends to help with the household expenses. Teach them how to save money by turning off lights when not in use, cutting back on taking showers if not necessary, etc.
Many churches and other groups give out free food boxes. That can help with the expenses.
Best to "over do it" now and maybe have some extra money or time if the breadwinner totally loses his/her job.
Cut the children's allowance entirely. (Good lesson about reality for them. Also a lesson on how to cut back when something like this happens.)
And also cut out all other unnecessary expenses like paid TV, going out to eat, etc. If the breadwinner gets another job, THEN start spending again...
And plan for the worst right now. If the kids are old enough, see if they can do some part-time work after school or on weekends to help with the household expenses. Teach them how to save money by turning off lights when not in use, cutting back on taking showers if not necessary, etc.
Many churches and other groups give out free food boxes. That can help with the expenses.
Best to "over do it" now and maybe have some extra money or time if the breadwinner totally loses his/her job.
This is great advice. Kids should understand the need to cut back and cut expenses. Everyone in the family can pitch in to save money. As stressful as it may be, it may teach the kids some valuable life lessons. Growing up, my parents scraped by and I had to earn many of my luxeries. It taught me the value of hard work, saving my money and now we live quite comfortably.
Allowances are a funny thing. We started them for our kids last fall and my husband was very generous----way too generous imo. They got quite a bit of money for doing the minimum amount of work. When each chore turned into a huge sibling fight, we stopped allowances completly. They aren't ready for them. When we restart them, we are cutting them back drastically. If our family was in financial crisis, allowance would be the first thing to go.
1) Yes, the breadwinner should look for an additional part time job to supplement the income he/she lost due to the paycut.
2) This is something that should be discussed with the children. If children are still keeping up with their chores and duties around the house, I'm not sure it would be fair to deprive them of their allowance particularly if they're tweens / teens. I think the parents should discuss the possibility of a cut in their allowance (ie: $5 a week instead of $10) but also offer extra work incentives for extra money if/ when available from time to time (raking leaves in Fall, shoveling snow in Winter, etc etc) to supplement the loss in their allowance.
This will get somewhat OT. A job cut plus a P/T job (good ones are scarece as hen's teeth especially if you are over 21) is a bandaid for everyday bills. One earner in a family has to have a job to make enough to keep the family in its lifestyle, save for a rainy day and still have time to spend with the family. A jobsearch in itself is a fulltime job. The days of filling out an application, handing it to a friend of the family and starting next week are over.
Teens and tweens need to know what is going on and pull their weight. There is no opening an equity line for tuition when you do not have the income.
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