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Ask Dave

Should We Reward Good Grades With Money?

Joe asks what Dave's opinion is on rewarding kids with money for good grades in school. Dave doesn't have a strong opinion one way or another.

QUESTION: Joe in Tennessee asks what Dave’s opinion is on rewarding kids with money for good grades in school. Dave doesn’t have a strong opinion one way or another.

ANSWER: I don’t have a strong opinion about that one way or the other. We did not pay our kids, but I can’t think of a really strong reason to not pay them. The argument that you would not pay them because it’s something they’re expected to do anyway is somewhat valid, but it’s also valid about chores.

We paid our kids commissions to do some chores. Some chores, they just had to do them because we said to. The reason we paid them is not because they were worth it. They’re not worth it. It’s easier to do the chore yourself, and what you pay them for the work they do is ridiculous. That’s not the point. It’s not the economic value of it. The reason you pay a kid is you want the kid to associate work with money. I meet 54-year-olds who have never made that connection. Work creates money, and you want them to learn that. It’s a neat concept. Once they have created some money by working, then you want to use that as a moment to teach them to save, spend wisely, and give.

There are really four things you must teach your children about money before they leave home, or they will end up in your basement. They need to know how to work, save, give, and spend. You can do that around the subject of grades if you want to. There’s a valid case to be made that getting an A is a lot more work than getting a C. It’s a lot more work for some kids. For some kids, it’s pretty easy. I’m one of those who had to work at it. Other kids are just smart. I actually had to do the work to get there.

There’s a case to be made in favor of it. We didn’t do it. We paid our kids just on the work, and we said, “Okay, getting grades is like your job. It’s just what you do just like some of the chores you do around the house you do just because I’m bigger than you, and I can make another one that looks just like you. I’ll take you out. Sometimes you do things for your mom because you love your mom and it’s an act of service in the household to help her clean something or lift something. When you’re 14 years old, you have muscles. Use them, puppy, and lift something for mom.” Grades can fall under that.

Again, I don’t have a strong issue if you want to pay a kid for grades or if you don’t want to pay them for grades. You’re certainly not obligated to just like you’re not obligated to pay them for work, but you miss out on the teachable moments. We did not pay our kids for grades, but we don’t have a big thing that we say you’re stupid if you do. We just didn’t. We just required them to do the work in order for them to continue to have a life and not be grounded and everything else.