It's never too early to start teaching your kids about money. The sooner you start, the better! One way to give your kids a head start is by giving them pocket money. A small cash allowance can help kids learn how to save and spend responsibly.
Why give your kids pocket money?
Giving kids pocket money is one way to teach them about managing money. They can learn how to budget and save for things they want. It also helps them to develop an understanding of the value of money. For example, you can help them understand what it means to earn money by doing simple household chores around the house.
So, if you're thinking about giving your kids pocket money, there are plenty of good reasons to do so. Just be sure to give them an amount that they can realistically manage and help them understand how to spend it.
With a little guidance, your kids could be on their way to becoming responsible money managers!
How to approach the subject of money with kids
You'll want to avoid making your kids feel like money is a taboo subject. Friendly, open discussions will help them feel more confident asking questions and raising any concerns.
With younger kids, you can share your own experiences with money when you were their age. For example, did you save up for something you really wanted? Teens might be more interested in learning how they can earn money with a part-time job, and how earning interest on bank savings works.
How much should you give your kids in pocket money each week?
If you do choose to give your kids an allowance, think about what they’ll be spending it on. For example, will they be using it for school lunches and bus tickets, or just for occasional lollies and soft drinks? You may also want to factor in how much money your kids can save each week. A good rule of thumb is to start with a small amount and then increase it as your kids get older.
What can kids spend their pocket money on?
Again, this is up to you. You can give your kids guidelines and help them make their own decisions. For example, you can limit how much your kids spend on sugary treats by helping them work out a weekly budget. If they know they’re saving for a favourite video game, they won’t want to blow their budget at the local lolly shop.
Further tips for helping your kids learn about the value of money
- Help your kids create a ‘wish list’ that will help them prioritise their spending.
- Teach your kids about responsible spending. They should know they can't always buy everything they want.
- Encourage kids to give a portion of their pocket money to charity. Teach them the importance of giving back.
Consider opening a savings account for your kid
Opening a savings account for your kids is one way to help them save money and track their progress towards goals. Why not explore Suncorp Bank’s Kids Savings Account? There are no monthly fees and no minimum balance to open an account or earn interest.
Published 04 November 2022
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