Giving pocket money allows children to learn how to manage their own money. Use it to teach them how to plan ahead and save up for things.
Start to help your child understand about money as early as possible. Long-term financial outcomes in life can be predicted from five years-old.
Children who have responsibility for their own spending and saving decisions show better understanding of the value of money. They also know the difference between needs and wants.
Read our article on how do I educate my children about money for advice with helping children of all ages to learn about money.
This should fit the child’s age and your beliefs around money. Also consider your budget. Will your child buy all their treats or will you pay for extra games, sweets and apps?
The average UK pocket money is around £7 a week. But how much money children get is less important than that they practise with their own money.
Remember needs change as children get older. Planning ahead will help you to budget and your children to learn what they need to save for.
Here are some options on how to handle pocket money:
Opening a savings account can help to encourage children to save from an early age and teach them the value of financial responsibility. Find out more about how you can give your child a financial head start and the different children’s savings accounts available.
Whatever you decide to do, it’s important to talk to children about their choices, and show them different ways to use money.
Give your child the freedom to make decisions and learn from their mistakes and successes with their own money. Talk with them about how their choices worked out and what they have learned.
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