Are you wondering whether or not you should pay your kids for good grades? You are not alone. Many parents struggle with how to motivate their kids to rise to their full potential.

Being a parent does not come with a manual. Sure, there are articles and books on how to be a good one, but at the end of the day it has much more to do with the how than the what.

Two sets of parents can do the same exact thing with wildly different results because all children and families are unique.

Why Grades Are Important but Not the Most Important Thing

Grades can be a tricky subject for a myriad of reasons. There is no getting around the fact that grades are important. Forbes Magazine cites several studies that show that good grades in high school can correlate to higher-paying jobs.

Grades will help determine whether your child will go to college, where they will go, and whether they will receive scholarships.

Psychologically grades are also important. For the first time, children are given a “scorecard” that judges their abilities in a range of subjects.

Kids spend 35+ hours at school every week, the equivalent of a full-time job. Report cards tell parents how successful they are at that first job, and that can be a little scary.

It’s hard for many parents to strike the right balance between 2 ideals about grades:

Grades are AN important thing and
Grades are not THE MOST important thing.

Not every child is capable of straight A’s. And the emphasis on a grade sometimes replaces the actual learning of the concepts. This can lead to other problems.

In certain schools and families, there can be overwhelming pressure to achieve. When this occurs, a child’s mental health might suffer. Kids could develop anxiety and a fear of letting their parents down with a B or, God forbid, a C.

Like everything else in life, encouraging good grades comes down to finding the right balance for you, your child and your family.

Before you start a system to help your child with grades, spend some time assessing your child and their individual abilities. This way you can best encourage growth in areas where it will have the most impact.

Want help motivating your kids to do their homework? Download the award-winning App that motivates kids to get good grades!

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Research That Motivated Kids to Get Good Grades

A lot of money has been spent researching ways to externally motivate children to get good grades.

Perhaps most famously by Roland Fryer out of Harvard. He paid millions of dollars to low-income students in several major cities to try to improve their test scores. The major takeaway from the study is that incentives worked better when they were paid out for things the students felt they could control – input v. output – the work v. the result.

The problem with these studies, and so many others in this field, is that we’re not talking about paying large groups of students. We’re talking about whether in your family you should pay your child.

These studies do not capture your individual child and your family dynamic.

Your Family With Multiple Children

You might have one child (firstborn perhaps?) who is type A and internally motivated to achieve perfection. They have a built-in love of learning and reaching goals.

Then you have another child who is not as motivated and would benefit from external motivation to do better in school.

You want to be fair, but you might worry that paying for something your oldest is already doing may decrease their internal motivation since now they will expect an external reward.

You know your child better than any academic ever could. If you’re researching this issue, chances are that you are looking for a way to incentivize your child.

Yes – we all wish we had intrinsically motivated children – the kind who brush their teeth, do their chores, and overachieve at school, just because it makes them feel good inside.

And my compliments to the parents who have managed to raise those children.

But the rest of us frequently find ourselves having to externally motivate children just to get through the day, week, semester, and school year.

10 Reasons Why Paying Kids for Good Grades is Smart

We’ve compiled a list of reasons to provide outside motivation to help your child achieve the best grades they are capable of. And ultimately, to become the very best version of their scholastic self.

1. We All Need Some Motivation

The truth is, we all do better with some incentive. In theory, we want kids to work hard due to intrinsic motivation, not extrinsic motivation.

In actual practice with school, this just might not be the case. Every single kid is different. Some will bring home straight A’s with little work, and no need for compensation.

This is amazing.

However, some kids will need some extrinsic motivation to get them to put in that extra effort they need to get a good grade.

Many schools provide some external motivation in the form of Dean’s Lists or other awards.

The farther kids get along in school, the more important grades become.

Most high schools and colleges recognize the top performers and they tend to reap rewards in the form of scholarships or good-paying jobs.

Paying for grades is just one more form of recognition, but one you can start earlier before schools start to turn up the heat.

2. Positive Reinforcement

Paying for grades is positive reinforcement, not punishment.

Positive reinforcement encourages kids and shows that you appreciate the hard work it takes to get good grades.

Kids will strive harder to hit those goals since they will want the reward.

Getting bad grades does bring negative consequences – some you can see now, and some they will realize later. We know that positive reinforcement is the better alternative.

Think of the ways you use positive reinforcement in your family. Some families use star charts, some apps, others heap on the praise.

As parents, we are constantly told that positive reinforcement is the way to go. So it’s a little funny that people get a “judgy attitude” about this form of positive reinforcement.

3. Kids Rise to the Level of Expectations

There is a fine balance between pushing too hard and healthy motivation for good grades. The reality is that children rise to expectations.

Expecting good grades doesn’t make you Captain Von Trapp with a whistle. It just makes you someone who wants the best for your child.

It’s important to set appropriate expectations. If your expectations for your child are unrealistic then your child will simply feel like they are disappointing you over and over again.

This is bad for their self-esteem, and will likely result in them just giving up.

You can expect your child to bring home grades that align with their abilities. And you can respond appropriately if it doesn’t happen.

If you are paying your student for good grades, it’s a very easy conversation. “I love you and I’m proud of you. It’s okay to fall short of our goals sometimes.” They will be disappointed in missing the mark, but also learn a valuable lesson of how to move past disappointment and do their best the next time.

4. Pushing Beyond the Comfort Zone

There are children who are absolutely capable of better grades but see little point in them. They have discovered that they can bring home mediocre grades with minimal effort, and have plenty of time for things they would prefer to do.

Unfortunately, settling for mediocrity is not the best lesson to learn as a child.

To be great, we have to push our limits and comfort zones.

Rewarding your student’s good grades with money gives them a reason to strive for that excellence.

The goal is to give them a taste of achievement. And hope that they internalize the good feelings that come with trying their absolute hardest and realizing the results.

Kids love hearing the stories about the origins of their favorite athletes – how many nights they spent shooting hoops for hours, running routes, and playing at the sandlot.

Spend some time talking with them about academic heroes – the ones who cured diseases, or engineered the impossible, or wrote moving poetry. They also didn’t simply get there overnight.

5. Kids Need Money Anyway

At My First Nest Egg, we are staunch believers that kids need to learn about money. One of the best ways to teach kids about money is to experience spending, saving and giving their own money.

Kids should earn that money, and grades are a great way to earn a cash incentive

Most people buy their kids things. Some buy them more things. Some buy them less things. But in the US, kids seem to have a lot of things.

If you want kids to learn about money then you need to give them the ability to earn money, and the freedom to spend it.

Even if it’s on something you think is monumentally dumb.

They need to learn those lessons for themselves, feel the difficulty in earning the money, and the pain of spending it, the triumph of savings and interest, and the disappointment of failed purchases.

Paying kids for grades is a good way to give them pocket money to start learning how to manage finances from an early age.

6. Paying for Good Grades Can Actually Relieve Pressure

There are many type-A children who put an unhealthy amount of pressure on themselves to be perfect. There are children who would see themselves as abject failures if they brought home an A-.

This simply is not the case, and you can teach them to relax a little by paying for grades.

This might seem counterintuitive, but by setting a schedule for payment and paying a lesser amount for less-than-perfect grades, kids learn that it’s not an all-or-nothing game. It’s okay not to be perfect, and strange to expect perfection from children we wouldn’t expect from adults.

7. Payment Shows You Don’t Take Their Grades for Granted

Kids often feel oppressed and overworked. It’s a tad humorous to most adults whose responsibilities far outpace those of their little progenies. But still, feelings are feelings and little people have big ones.

Paying for good grades tells kids, I see you. You’re working hard. It’s not easy. I’m proud of you.

There is certainly the argument that kids shouldn’t be paid for good grades, because that’s just meeting expectations.

The truth is, expectations can be high and there is no reason not to acknowledge kids meeting those expectations. And a monetary reward is a great incentive for most kids.

8. Setting Kids Up for Success

When you’re a parent, you often have to persuade your kids to do things that are good for them. This is because they might not realize how important those things are yet.

Brushing their teeth is one example. At some point, most people learn the importance of proper oral care. If you let your kids ignore their teeth until they learn that lesson, they might have no teeth left.

Education, school, and good grades are similar.

Kids might not understand the importance of good grades for quite a while. And it’s fine to use whatever means at your disposal to get them to work as hard as possible until they figure it out for themselves.

You don’t want your kids to realize halfway through high school that grades really do matter, and that it’s too late to bring their GPA up to a desired level.

9. Teaching Kids to Save

One way to pay for grades is to deposit the money into an interest-bearing account (such as the “Save” section of their Nest Egg). This is money they cannot spend right away, and it can be earmarked for a special purpose (a car when they’re old enough to drive, or even college).

You will be encouraging good behavior and habits now while teaching them delayed gratification. We all know that delayed gratification is one of the hallmarks of financial success.

The goal is that when they get that first job and their employer offers them a 401k matching plan, they max it out because they understand the power of savings.

10. Good Habits are Worth the Money

The habits behind good grades are worth teaching early. Kids will understand that good grades are the goal, and they will be challenged to learn how to achieve that goal. They might fall short, and they might struggle, but at the end of the day, the good habit they develop will be worth the pain.

Once habits are formed they are hard to break. It’s important to work to help your child form good habits early, instead of trying to break bad habits later.

The habits that help kids get good grades will also help them at their first jobs, career path, and in life in general. This mindset of giving something their best effort is a great life skill.

5 Ways to Start Paying Your Student for Good Grades

Now that we’ve established that it is okay to pay kids for good grades, let’s discuss how.

Not every child will be motivated the same way. Here are five suggestions on how to use the almighty dollar to get your child to keep their nose in the books.

1. $$ for A’s

This is the most straightforward way to pay for grades. If your child brings home an A, they get paid for that A. If your child brings home a B, they don’t get paid for that grade. If your child brings home straight A’s, they get a bonus.

This method can be used on a very specific kind of child. One that is fully capable of straight A’s and just isn’t quite putting in the effort to achieve them.

Or even the child who is bringing home straight A’s and you want to recognize that achievement.

The all-or-nothing approach will incentivize kids to put in the time to not only get the A, but also bring home straight A’s for the bonus.

2. Sliding Scale

Not every child is capable of straight A’s. And that is okay.

In fact, it is widely believed that Emotional Quotient (EQ) is as, or more, important than IQ when it comes to success in life.

IQ accounts for 20% of success, while EQ is the other 80%. If this is your child, then it’s truly important to give them the space not to have perfect grades.

A sliding scale is a good approach for a child who needs an extra incentive to do well but might fall short of A’s despite their best effort.

You could pay one amount for A’s, and another for B’s – down the line as far as is necessary. This will give them the incentive to do well but not make it feel unachievable.

3. C’s Get Degrees

For some children, it is a struggle just to pass their classes. This is a stressful position for a child and the worst thing you could do would be to pay them for A’s when bringing home a C is a struggle. We do know from the study mentioned earlier that paying for something that they don’t feel is achievable is useless.

If you have a child who is struggling to pass their classes you can pay them for bringing home passing grades with a bonus for passing all of their classes. They will feel good about what they have accomplished, and the extra time they’re putting in might slowly help them bring all of their grades higher.

4. Pay for Input v. Output

Paying children to do the things that lead to good grades might be an excellent place to start. Pick the things your child isn’t particularly motivated to do (reading, math facts, studying) and pay them for those milestones. It could be chapters, pages, or time.

One easy way to motivate your kids with this method is on our the My First Nest Egg App.

We help kids achieve with earning puzzles.

You could take a picture of the book your child is reading. Our App will break it into pieces, and you can award a piece for every chapter they complete.

They will be able to watch their reward come together piece by piece. When they’re done a set amount will be deposited into their virtual account.

5. Experience v. $$

It’s very possible that your child won’t be motivated by money. Kids are like adults; they can be motivated by different things.

Find what motivates your child.

It’s very possible that it is an awesome experience. You could motivate your child with a trip to ice cream for every (insert target grade here).

This is a great way to motivate even little kids. Many little kids don’t bring home grades per se, but other marks and comments on a report card. Y

ou could reward your child with a morning cocoa trip if they bring home stellar comments on their attention or attitude. It will tell them that those things are important to you and start pushing them towards achievement early.

Conclusion

While there is some controversy that surrounds the paying for grades discussion, there doesn’t need to be. Like so much in parenting, we are all just trying to motivate our children to help them to become the best version of themselves.

In parenting, there is a wide range of normal and that is driven by the fact that kids and families have different value systems. Families need a generous space to find what works for them and grace while they try different methods.

If you are a parent struggling to motivate your child, just know that you are not alone. Maybe give money a shot – maybe try experiences – maybe it’s just morning pep talks on your way to school.

However you choose to help your child, the most important thing is that you’re paying attention and doing your very best to raise a good kid.

That effort and love will ultimately be the biggest determining factor in their future success.

10 Great Reasons Why Students Should Get Paid for Good Grades

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