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To me i feel you dont need to give allowance afterall you all are family. Is her part to takecare. Maybe can give her monthly just abit for her enjoyment or food. As she is alrdy staying at your place and have almost everything provided

My dad gave his mil $2K for 2 kids per month. But I think $1K should be alright otherwise try to work out your budget and discuss with your mil. :)

Thank you for your advice! :)

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