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Do kids get enough pocket money?

More than half of children say they get the right amount of pocket money, even though the average amount given has dropped for the second year running.

Today’s annual Pocket Money Survey from Halifax reveals some interesting stats about UK kids and their finances.

Less children receive pocket money than last year, with the figures down 4% to 78%.  Those that do are getting an average of £6.20 a week, 30p less than in 2013.

Although one in five kids think they should get more money, just over half believe they get enough.

Meanwhile, only one in five children have to complete chores to get their pocket money.

Why pocket money can help your children

As well as giving them independence, pocket money is often the first time children have any financial responsibility.

There’s a good chance how you saved and spent your pocket money had an impact on how you are with money today.  So if you are a parent, we’ve got three ways you can use pocket money as a tool to build your children's financial skills.

Encourage them to save

The survey found 70% of children are saving at least part of their pocket money. Better still, a quarter don’t spend half of it, and one in ten put it all aside.

Saving is a great habit to get them into, and you can help by talking to your child about something they really want but can’t afford.

Help them work out how long it would take them to buy it if they saved all, half or a quarter of their pocket money each week. You can even make a progress chart to keep them motivated.

Though they might want to keep some of the money in a piggy bank, opening up a savings account for your child can get them used to proper banks.

Be consistent

The Money Advice Service’s own research found only four in ten parents gave pocket money at regular intervals. Inconsistency can make it harder for children to learn about managing their money. 

So giving a set amount at a set time – say once a week or month – can help kids begin to learn about budgeting.

This also means not giving them extra ad hoc money when they ask for it, or bailing them out if they overspend.

Increase what they have to pay for

You probably just give your children some money to spend as they wish, yet as they get older you can help them learn more about managing their money by increasing what they get – and what they have to spend it on.

Take clothes as an example. Work out what you spend on them for your child in a year, divide by 12 and give this to them as a monthly allowance.

When they’re confident with this, add another such as cinema and social events, or a mobile phone, and keep going until they manage all their major expenses.


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