Pocket money is one way you can teach your child the value of money. It’s also a personal choice and you may choose to wait. However, evidence shows that giving children even the smallest amount of money regularly helps them learn how to manage money.
How much pocket money should I give?
There’s no right amount – as it can depend on how much spare money you have and how old they are. The key is to give them money regularly as this helps them to learn how to save and budget.
If you don’t have enough spare money to give pocket money, you could look at whether some of the money you spend on sweets, treats or toys could be used as pocket money instead.
You also need to decide how much responsibility they’re ready for. Think about what you want them to use it for, such as:
- all their treats, toys, books and magazines – or just for a few extras
- trips out
- clothes
- mobile phone bills
- presents for family and friends.
It’s also worth thinking about when you’ll increase it. You could do it on their birthday or when they go to secondary or middle school, or sixth-form.
Giving pocket money in return for doing chores
You could give your children money in return for doing chores. This helps them learn that, usually, you need to work for money. They might also be more likely to do chores!
However, this approach might not work for you if you want to use chores as a way for them to learn that they need to help out around the house. You might prefer to teach them that they should do chores because they’re asked, not because they’re being paid.
How often to give pocket money
How often you give your child pocket money depends on how old they are, your budget and how much responsibility you want them to have.
Giving regular pocket money
Their own money to spend
Giving your child an amount of money to spend each week, fortnight or month is a good opportunity for them to:
- learn how to save and manage money
- make mistakes with small amounts of money so they can find out what doesn’t work well
- learn the value of things.
It should also mean that your children won’t ask you for as many things, as they have their own money to spend.
Giving when you have spare money
Giving your child money as and when you have some spare means you don’t have to worry about spending too much and your child still gets the chance to practise with money.
It does mean they might find it harder to save up for things as they won’t know how long it will take them to get enough money. And they also might still ask you to buy them things.
Changing how often you give pocket money
When children are younger, giving weekly amounts gets them used to making their own decisions about what to spend money on.
As they get older, a monthly allowance can help them to budget over longer periods of time, which could help them to prepare for managing a student loan or even a salary.
Saving
Saving together as a family can teach your child how to wait for something they want and the value of money. You can save online or by using cash.
Saving together
If you’re using cash, you could set up three jars labelled:
‘treats’, ‘holidays’ and ‘long term’.
After you’ve paid for the essentials, show your child the money you have left to put in the different pots. Let them put the money in and count how much you have. When you’ve saved up enough, show them the choices you all have.
You can do the same thing online using different accounts or one bank account that lets you split up your money into different categories.