Should kids be given pocket money? Know The Facts
If you want your child to understand the value of money but think it is too early to start the lesson then think again. Experts opine that it is never too early to teach children about the significance of earning money and regular savings. Another interesting trend that has been noticed among kids is that they learn their earning and spending habits from their parents only. This means if you are not very good at managing money matters then there’s every chance that your child will also take it lightly. Every parent, therefore, needs to play a responsible role in this regard and lead by example.
There are many parents who feel that paying pocket money is a great way to encourage children to take money related decisions. Then there are families who strictly oppose the idea citing that in their childhood they never enjoyed the luxury of receiving a monthly or weekly allowance from parents! So the debate keeps going on about whether to allow or refuse pocket money. Here we try to answer few questions frequently asked by parents.
Should you pay pocket money to kids?
Ok, here we start with the prime question. If you are in a dilemma then it is always advised you do a little bit research for your child’s benefit. Discuss the matter with other parents to know what they are doing and how. It is also important to consider whether you can actually afford an allowance on a regular basis. Finally, it’s completely the parent’s decision which should be taken after weighing the pros and cons.
How much pocket money should one give?
Again, there is no set mathematical formula which will help fix the amount. It depends on how much you can afford and how you wish the money to be used. There are children who get the allowance on a monthly basis while some get it every week. One strategy you can follow is to decide the pocket money as per age and increase it gradually as the child gets older.
How do you pay the pocket money?
This is another significant question which every parent keeps asking. Let’s discuss several options. There are parents who prefer to pay the money as a reward for achieving higher grades at school, for not breaking certain rules at home or on special occasions. Another idea many follow is paying the pocket money for doing certain household chores. Now this approach could be bit tricky as it gets tough to decide for which jobs the child should be paid and which jobs fall under the ‘family job’ category. If you are not comfortable with any of these ideas then you can just fix up a certain amount and pay it as pocket money for day-to-day expenses without expecting anything in return. However, this approach is suggested for the older group of children aged above 7 years.
How to teach your child the value of pocket money?
Now that you have decided a monthly or weekly allowance, it is very important that you guide your child about the significance of saving and spending money responsibly. You can set up a certain rule like spending 40% of the pocket money, saving 50% and donating the rest 10% to any cause your kidchild would like to support. Of course, it’s not necessary that you have to follow this break-up. You can also discuss with your child about how to split the pocket money for varied purposes. However, it is very important to make sure that your child understands the concept of saving by is saving a part of the pocket money in his/her piggy bank. Some parents go a step further and open a bank account in the child’s name so that his/her pocket money starts earning interest.
Some mistakes to be avoided while giving pocket money
Now that you know the thumb rules about pocket money, you should also remain aware of some common mistakes which parents often commit while sanctioning the allowance. Firstly, it is never advisable to give away a huge sum of money as monthly allowance. Secondly, if you have set up a fixed amount and date to give the pocket money, then follow that schedule. Don’t give in to the child’s tantrums if he/she keeps demanding money in between. Finally, always keep a watch on your child’s spending.
To conclude, set up an approach to pocket money which is practical to you and beneficial for your child.