Children tend to learn their attitudes towards money from home. Pocket money is the opportunity to teach about spending thoughtfully and saving. Money management helps them make choices about spending, saving and waiting for this they want.
Helping your child develop good financial skills at an early age, means they will be ready for any financial challenges in adult hood. Showing them how to budget, spend wisely and save their pocket money.
When it comes to understanding money it’s never too early to start. If you think it’s right for your family and can incorporate it into the budget, then giving your kids pocket money is a great way to develop their money skills and encouraging independence, patients and goal setting.
Paying pocket money is not always appropriate for every family, so it is up to you. There are other ways to teach them about money:
Setting up a bank account for your child gives them a good starting point in the direction of saving and interest at an early age. Some primary school children can do banking through their school banking program. This can familiarise your child with these kinds of money concepts, by explaining to them what is involved in the bank statement. Showing what money went in, how much the balance of the account is and what interest was paid.
Piggy bank or child’s own account. This is a fun way for children to start learning about money and encouraging saving. This is a more tactile experience and good starting point for younger children than putting money into a bank account. As the child can physically count the money and achieve a sense of recognising coins and notes.
Paper rounds. Besides the usually pocket money for chores done, why not get your child involved in paper rounds with your supervision. For example when my daughter was 10, I took on a paper route and got her to come along with me. After the paper route was done I would spit the money with her. This money is then paid to encourage a good work ethic. This is then reinforcing that you only get paid when you complete the job that was given to you.
Pocket money is a great way to introduce children to the idea of saving and budgeting. Set up an approach to pocket money that makes sense to you and is practical for your family.
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