Pocket money: teaching kids the value of money

three children sitting around open piggy bank

three children sitting around open piggy bankIt’s a thorny subject in some households and lucky is the parent who has never heard the words: “but Jonnie in my class gets double that”…. I am talking, of course, about pocket money.

Before we come to the prickly subject of who gets what, lets me first say that pocket money is an important “parental tool” for preparing our children for the real world of work and teaching them that money does not grow on trees. It is also a great combater for pester power.

Give kids the choice

In our house it was to combat pester power that pocket money was first introduced when my son was three. Yes, three. It is never too early to start helping children appreciate that life is about choices – even if it is just between a Disney comic or GoGo figure.

Don’t buckle; say “no” if they want something else after their weekly sum is spent.

Remind yourself that putting your child in control of what they spend pocket money on is a really crucial part of them learning how to weigh up the respective values of the options available to them.

With under fives it is not worth trying to get them to save any of pocket money – child experts say children don’t really get the concept of time until around the time they start school.

Earning pocket money

But all children, even the very young, should have to earn their pocket money. In our house that meant putting clothes in the hamper and making the bed.  Remember if they are old enough to spend it they are old enough to earn it!

As children get older, tasks can be added. My sister’s teenagers have been loading the dishwasher and washing machine since they were eight or nine, and my son’s best friend hangs the washing out on the line in return for his weekly allowance.

Let your children have a say in what tasks they are assigned to do.

Be tough though! If the agreed tasks are not completed, do not hand over the cash. After all, in the real world we don’t get paid if we don’t do what we’re employed to do.

How much pocket money?

And so to the matter of how much to give. Halifax produces an annual report on what the “average child” gets, dependent on where they live and their age.

The headline thing to take away from recent surveys is that the amount of pocket money given has actually been falling for the last few years, which probably reflects the fact that many of us haven’t had a pay rise for several years.

Ok, so here are the figures you need to keep in mind when setting pocket money for your youngsters:

  • The average eight-year-old gets £4.44 a week, rising to £8.38 by age 15.
  • Parents in Scotland and London typically give more, at £6.89 and £7.63 respectively.
  • Parents in South West England pay out the least at £5.15.