Pocket Money - How much to give your kids?
Receiving pocket money is definitely good for children, but the big question is how much money you should be giving your children. Here we help you to make a good decision.
Why give your child pocket money?Pocket money is often given to children by parents, grandparents and aunts and uncles as a treat. The amount of money – no matter how modest – given to your child is special as it is their money to use as they want to treat themselves to a comic, new book or sweets. Children learn that by saving their pocket money that they will be able to buy bigger and more expensive items that they would like including laptops and mobile phones.
A 2019 study conducted by the Yorkshire Building Society found that nearly 84% of children in the UK are given pocket money by their parents – and this can be from as early as six years of age. The same study found that 55% of six years olds do receive pocket money.
Research by a panel of behaviour experts at the University of Cambridge have interestingly found that the foundations for a person’s money habits are usually formed by the time they are seven years old and that these habits are so entrenched that they are hard to change when they are older.
What will your child’s pocket money be used for?Some parents choose to give their children a larger amount of money, but they are expected to buy some of their leisure clothes and shoes with the money plus treats like cinema tickets and even stationery for school. When calculating how much money to give you must first decide exactly what you want the pocket money to cover. It is important to discuss this with your child so that they fully understand. It is also lovely to give them unexpected surprises if you can afford to do so and pay for something that is usually in their remit.
It is always interesting to see how keen your child is in buying sweets and other treats when they have to pay for them them – often sweets become far less important in their spending plans!
When should pocket money be paid?The popular way to give pocket money to children is once a week – with Friday being the most popular day with Saturday a close second! Some parents with older children find that giving them a monthly allowance works well.
It is important to give your child their pocket money on the chosen day each week as this will help them to learn how to budget from one week to the next.
Once your child is old enough, it is a good idea to open a bank account for them and for your payments to be made in directly and your child to have their own debit card.
The average amounts of pocket money for the different ages.It is important that the amount of pocket money given to your child does increase with their age and this can be fun if it is linked to their birthday. For example, their pocket money increases by £1 (or any amount you choose) each year on their Birthday. The Yorkshire Building Society found that the average annual increase in pocket money in 2019 was £27 per year.
According to Go Henry, these are the average amounts that were paid to the different ages in 2021-
*7 year old: £3.52
*8 year old: £3.75
*9 year old: £4.12
*10 year old: £4.58
*11 year old: £5.34
*12 year old: £6.49
*13 year old: £8.09
*14 year old: £9.70
What household tasks can you ask your child to complete?If you would like to give your child some chores to complete for their pocket money each week, these will depend on your child’s age. Younger children can be encouraged to pick up their toys before bed, tidy their bedroom, and clear the table after meals.
Older children can complete tasks such as making their beds, loading/ unloading the dishwasher, putting washed clothes away and vacuuming. Feeding the family pets is another popular task that also teaches children about caring for animals. A large chart with colourful stars pinned to the refrigerator works well!
To make it a little more fun you can have a two hour family ‘ clean up’ on a Saturday morning where everyone (including Mum and Dad) completes all their tasks freeing up time for the rest of the weekend.
While many parents do stop the week’s pocket money if their child has done something wrong; it is best to put a positive spin on the situation and suggest that rather than forfeit the money, your child can complete a couple of extra tasks instead – these tasks are best if they are ones you can get involved with too such as tidying the front garden or washing the car, as this lightens the situation
Teaching your children how to saveIt is important to discuss with your child how saving a portion of their pocket money each week can be beneficial if they would like to buy something expensive in the future. Even if they haven’t anything in mind, it is important that they get into the habit of saving a little money regularly. They will soon learn how quickly this amount grows and how important it is to have money aside for a ‘rainy day’.
Opening a building society account which pays a little interest will definitely encourage your child to save and online money apps are fun because it is easy to see how the money is growing.
With this year proving so difficult for many parents and it becoming increasingly difficult to ’make ends meet’ the important takeaway from this is that the amount that you give your child is not as important as giving him/her a weekly set amount of pocket money so that they learn the first steps of money management. If you have chosen that they should complete a few household tasks for their pocket money, this will also teach them the link between work and financial gain too…...