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The problem with an allowance is that it teaches children the wrong behaviors. I don't reward my children for doing chores. No one pays me for coming dinner or doing the dishes. So what does paying them for doing chores teach them about life?

Instead I reward them for learning something new that they can then teach me, for playing sports, for playing music, for reading a new book.

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Good points. Good question. Seems like a generally wise thing to give a kid an allowance. You work hard, you get paid. Then again, as you mentioned: If all their needs are already comfortably met then I’m not sure the lesson fully holds

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