Call it pocket money, call it an allowance – whichever word you use to describe it, pretty much all parents and children understand the concept; where parents/caregivers give their child an amount of money, on a regular basis, to spend, for the most part, as they choose.
But many parents struggle to know how much pocket money to give, how often to pay it, and how and when to introduce it. So with the help of some online experts we have pulled together a short and simple guide to help you tackle all of these important questions:
These dictionary definitions show us the simple meaning of pocket money:
"Money which children are given by their parents, usually every week." Collins Dictionary
"A small amount of money that parents give their children, usually every week or every month" Oxford Learners dictionary
We are often asked if giving pocket money is a good idea and why it is important for children. Today online really nail it on the head:
“Beyond just enabling children to buy what they need, an allowance offers opportunities for parents to inculcate good money management habits in their children.”
Making your child responsible for their own expenses and learning to cope with budgets are valuable lessons for adulthood.
At the same time this also emphasises the importance of the decisions parents then make around how much pocket money to give, how often they give it and the spending rules they set around this.
Getting these details right will increase the chances of your child developing good financial understanding as they grow up.