Pocket money can be a great way to teach your child how to spend money with respect as well as gain an understanding of how to consume and save money.
Why, when, and how much to give your child in pocket money are all important issues that one as a parent should consider.
The purpose of giving children pocket money
We believe without solely being based on giving the child a basic understanding of what is. to be financially responsible and independent.
Many parents often wonder if the pocket money and the amount should be based on a so-called reward vs. penalty system e.g. in terms of school grades and for good or bad behavior etc.
We at Good Finance do not recommend using such a system. Rather, we think that pocket money should be given in connection with the execution of domestic duties so that fixed duties trigger pocket money.
We find this approach appropriate, because it teaches your child the importance of helping as well as working for the money as they do not hang on the trees.
There is no golden rule for when it is best to pay children pocket money
We believe this is entirely up to the individual parent to decide.
Most importantly, your child has a good understanding of the concept of money so that he or she can appreciate this regardless of the amount of money.
Possibly ask what the other peers in the social circle get and put you at roughly the same level.
Once you, as parents, decide to give your children pocket money, this will have a major impact on the child's personal development. The child will could develop financial independence.
Still unsure when to start giving your child pocket money?
We suggest you talk to your child about the topic. It is important that you explain to him or her what pocket money is and what this entails. You can Ask your child if she or he feels ready to receive or earn a pocket money along with the responsibility that comes with it.
How much to spend in pocket money?
This is often one of the "difficult" issues that parents must consider. Our best advice here is to start off with a relatively low amount and increase this as the child gets older.
You can also take advantage of the pocket money, which suggests how much it is common to give to a child of a given age.