Managing money is a life skill that we all need to learn, and the earlier we learn it the better off we will be in life.
Child pocket money Allowance is an excellent way to give children exposure to money. It’s much better than handing them money in bits and pieces whenever they need something-especially as they grow older. By exposing children to allowances early on in life, you can help them to appreciate the value of money and the joys of having enough money when you need it (versus the sorrows of not having enough).
So!
Teach them young- Get young kids a piggy bank and give them loose change on a regular basis. This will help them develop the habit of putting “something” away on a regular basis. Give them a weekly allowance as they may not be able to understand a date too much in the future. Every Sunday may be better than every 1st of next month.
Take them to the bank-When your child is older (say about 6 years old) you can expose him to the bank. Take the contents of the “full piggy bank” to the bank and deposit it in front of him.
Help them plan their spending- Create separate heads (eatables, books, etc.) try and instill some philanthropic values in them and create an ahead for “community help”.
Adolescents/Teenagers- In addition to regular spending make them understand that big purchases need to be scheduled- maybe to once in 3 months.
There are many other aspects to the child pocket money allowance topic too and we shall discuss those in subsequent posts.
Click here for a Case Study on Allowance (Pocket Money)
Top Questions on Allowance
- When is the right age to start giving allowance to children?
- My child runs out of allowance mid week and wants more
- My child wants more allowance because his/her friend gets it.
- Should I give them additional allowance for doing chores like helping around the house or fetching something?
- Should I use allowance as a reward and give it only when they do what they are supposed to and withdraw it due to bad behaviour?
- Should the allowance be daily or weekly or monthly?
- Should I give my child separate money (to spend) and separate money to save (to inculcate the saving habit)?
