In a world that nearly runs on money, teaching our children how to manage and spend theirs is a lesson that we can start to teach from a young age. Pocket money has been a common concept for years, but it can be difficult to judge exactly how to go about giving our kids pocket money. Although companies like Wizzcash can provide a short term loan in the case of a financial emergency, it’s important to teach our children how to manage their funds, and so we’ve pulled together some of the most commonly asked questions on how to do that and answered them for you.
How do I budget for it?
First and foremost, you need to make sure that you can afford to give your children pocket money. If you budget your own finances, can you factor in a small sum every week for your children on top of your other expenses? Disposable income is important, so ensure that you don’t reach a point where you don’t have that barrier. If you can’t afford to give your children pocket money, wait until you can rather than spending what you can’t afford – after all, you wouldn’t be teaching your children very good lessons about money management!
How much should I give?
There’s no right or wrong answer to this question. While the average is between £5-£10 a week, some families might give more or less depending on their child’s age, whether they’re responsible or not, and how many children they have. Look at your budget, how your child handles other things, and how much you might think that they can handle as far as pocket money goes.
What kinds of rules should I set?
Setting rules and conditions for your child to get their pocket money can not only teach them about managing their money, but earning money too. If your child has had to do a few chores from a young age to get their pocket money, they’ll go into the world of work with a different view than a child who hasn’t worked for a penny in their life. Guidelines and rules for earning will help your child learn self-discipline and the concept of earning rather than just getting. Of course, you have to take into account their age and that they’ll likely be at school too, but you can judge what your children can handle.
How do I teach my children?
Just giving your children money after they’ve done a chore or two can only teach your children so much about money management and earning. You can go steps further when it comes to teaching, especially with older children. Opening a child’s bank account can help them keep up with the modern world, and teaching them to save their money for big things that they might want can also do a world of good for future money habits. Give your children pocket money weekly rather than monthly to save them spending on anything big or frivolous before they’ve had the chance to think it through. Saving up not only teaches them how to save, but it will give them the opportunity to think through their purchases before they make them.
Generic advice is not a service regulated by the Financial Conduct Authority.