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I wrote a couple of months ago about the benefits of giving children pocket money and since then, the kids have really been coming on leaps and bounds with it. It’s as though having their own money has given them both a better sense of responsibility and a greater understanding of the costs, and therefore is helping them to understand the value of money. It has been something of a game-changer here.
The biggest learn for them has been in understanding that money needs to be earned. Yes, they still have some gifted to them from time to time, but they can actually earn their own each week and they love seeing that come in regularly. Last weekend Boo wanted something that cost more than she had in her piggy bank so she asked me what chores she could do in order to be able to have it. And she did those chores and did them well, genuinely saving me a job, so it was win for both of us. The key point here is that they do now automatically make the link that if they want something, it’s their own money that they use and if they want more money, they need to do something about it. There’s no more prompting from me about that, they just get it. Even Little Man at six years old completely understands this.
Recent purchases for Boo include a new sign for her bedroom and a new duvet set, things that she’d have previously just expected me to get. Now don’t get me wrong, I do still expect to buy things for them and actually something like a duvet cover would normally be something I would buy for her, but she had a new one very recently, has more than enough, she simply wanted a dachshund one she saw so she bought it. Little Man last spent at the school book fair (somewhere I would normally be absolutely fleeced, so this was a nice change!) and he’s now saving up for a Nintendo Switch game that he wants. My six year old is saving up for something, words I never thought I’d be writing as you’d understand if you knew my son!
I think that once then on the savings track, it’s worth thinking about the different levels of savings your children could have.
For example, my two tend to pop their pocket money earned from chores along with the odd handout from a grandparent into their money boxes. They then have an instant access savings account where money gifted to them on special occasions goes, as they normally spend half of it and save the other half. The only time that they have withdrawn from these accounts was when we went to Disney World last year as they wanted to have their own spending money and had been good at saving their birthday and Christmas money so that they would be able to do so. They do then both have long term savings plans, and they are fortunate to have their grandparents paying into those for them directly every month. In Boo’s case she was just at the right age to have a Child Trust Fund, and then I took out a Junior ISA for Little Man. CTF’s no longer exist, so Junior ISAs are the way to go now, and if you’re unsure about what these are and how they work, there’s a quick and easy parent’s guide to Junior ISAs here.
This week chat initiated by my boy has turned to, ‘what other chores can I do each week to earn more?’. Good question. He really is grasping this work ethic. And he really does want that Switch game! Age appropriate chores can be tricky to think up, so it is handy to check out this chore guide from RoosterMoney, the pocket money tracking app, with a few suggestions by age group. It’s given me a few more ideas so I’ll put them to the kids and see what we can agree on.
Now that the children are used to receiving pocket money, that they have earned, I cannot imagine us giving them money any differently. It has really changed their attitudes to purchases. Jaunts round the shops were often chances for them to ask for various things that they saw, whereas now it’s more about considering what they might need to save up for or weighing up the instant gratification of that toy or magazine versus saving a bit more and getting that game that they really want. I love that they are able to think like this now and that they understand how they are contributing to their home with their chores.
Do your children receive pocket money? Do you find that it has made a difference to their saving/spending habits?
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