![]() One way to do this is by sitting down with your kids and coming up with something that they’d be excited to save up for, like a video game or toy. For instance, if you’re giving them $10 each week, they’ll need to put 20% (or $2) of that money away in a piggy bank or savings account to be used for a future goal.Īnd goal setting really is key. Ideally, you’ll want to make saving a prerequisite for your kids to receive pocket money though. Saving money: it’s one of the fundamentals of successful personal finance, and it’s certainly a good habit that parents can foster in their kids early on through a regular allowance. An allowance should be a privilege to be earned, not money that is simply handed over, which means you may need to withhold it if expectations aren’t met, though you’ll want to be clear as to why. Top tip: Once you’ve negotiated the conditions for pocket money with your kids don’t be afraid to stick by them. Of course, these responsibilities can change with age, but some of the more popular ways children earned their weekly pocket money were by tidying their rooms, washing up and clearing the table after meals or by taking the family dog for walks. In fact, 89% of parents said that their children earned an allowance by helping out with household chores. ![]() For the majority, pocket money is a system which encourages reward for effort. ![]() Helping kids get to grips with the basics of money is one thing, but the concept of earning is another important idea that an allowance or pocket money could help foster.Īfter all, most families aren’t just handing over cash to their kids. Of course, this also comes with the added lesson that money is finite, so they’ll have to spend their money wisely!įun fact: 78% of parents pay their kids pocket money in cash! The tangibility of coins or notes could be a benefit for younger children just getting familiar with money, though it’s not unusual for parents to organise a bank card for older kids given the greater flexibility and convenience it can provide. Pocket money can also be a great way to start giving your kids the freedom to make their own financial decisions – namely, what they would like to spend their money on and where they would like to spend it. Setting up an allowance can help kids get to grips with basic concepts like the different forms money comes in (coins, notes or even a digital balance) as well as the various ways money can be transacted (via cash, cards, smartphones, digitally etc.) So what better way to start teaching children about the fundamentals of finance than with their own money? It’s an important part of life, and something kids are naturally curious about. Like it or not, it’s hard to downplay the significance of money.
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