Pocket money is a personal thing and there’s no such thing as right or wrong, but knowing where to start can often be overwhelming.
Pocket money can be a great way to teach your children the value of money, but from when to start, how much to give them and how often to hand it out, there can be a lot to get your head around first.
So, if you’re little’uns are growing up and you’re looking to start their pocket money scheme, here’s everything you need to know to get going.
Note: you’ll see a trend emerge throughout this article; it all depends on you. There are no golden rules when it comes to pocket money and it’s all about coming to answers that suit your personal circumstances.
What’s a good age to start giving pocket money?
On the one hand, you don’t want to start too early and for the very concept to completely go over their head, but on the other, you don’t want to start too late and miss out on valuable money-learning opportunities.
That said, there isn’t a wrong age when it comes to pocket money. Whether your child’s four, seven, nine or 11, there’s no such thing as missing the boat.
If you’re really not sure where to start, here are three signs your kid(s) could be ready:
1. They understand you need money to buy things,
2. They get that in order to buy more expensive items you need to save first, and
3. They know that if you blow all your money there’ll be no more until you next get paid.
How much pocket money should I give?
According to research by RoosterMoney, on average, kids in the UK get around £5 in pocket money a week - that’s £260 a year for just one child.
Needless to say, that’s not always affordable for everyone and less is absolutely okay, so don’t feel like you have to keep up with what other parents are paying.
To see what’s feasible for you, go through your accounts, see how much disposable money you’ve got left after your bills have been paid, and then decide what you’re comfortable parting with.
If you’re strapped for cash but don’t want your child to miss out, think outside the box and come up with some money-free alternatives. For example, tokens for:
Their favourite pudding,
A trip to the beach,
A later than usual bedtime, or
Half an hour more TV time.
How often should I give pocket money?
Most people give it weekly but that doesn’t mean you can’t mix it up. If your purse strings are a bit tight switching it to biweekly or monthly could be a great way to save a bit of money, or you could even tie it in with your own payday.
Should I stick to set days?
It’s a good idea to, yes. Whether it’s Friday every week or the last workday of every month, sticking to a set day gives your kids a flavour of what it’s like to earn a wage and budget.
Talking of budgeting, try to avoid giving cash advances if your child’s run out of pocket money before their next instalment; it goes against the whole purpose. Instead, explain to them that’s why it’s so important to carefully spend and manage money.
Can I withhold pocket money?
If you want to, yes. Some parents withhold pocket money to teach their children a lesson if they’ve been naughty and there’s nothing wrong with that. However, reclaiming pocket money you’ve already given them is be a different story, as it could actually discourage saving.
What’s the purpose of pocket money?
The main reason parents give pocket money is to teach their children the value of money. As well as hopefully eliminating some of those tantrums kids have when they don’t get what they want(!), it also sets them up for later life when understanding budgeting’s essential.
Should I police what they buy with their pocket money?
Within reason, of course, you should let your kids buy what they want with their pocket money. Most spend it on toys and sweets and some even stash it away from an early age to save up for bigger purchases - like a scooter or Xbox game, for example.
And remember, making mistakes is part of learning so don’t blow the roof off if they make the odd one. If it becomes a trend though, nip any bad money management habits in the bud by having a chat with your child and letting them know the consequences of their spending.
Should my child have to earn their pocket money?
Once again, this depends on you. Some parents link pocket money to chores (like gardening, washing the car or putting the bins out), while others don’t require anything in return - again, there’s no right or wrong.
Whichever route you take though, it’s a good idea to keep consistency. If you gave pocket money for eight months straight in return for a chore and then stop, for example, it could leave your child thinking money’s easy to earn all of a sudden.
Disclaimer: All information and links are correct at the time of publishing.