The British tradition of providing pocket money to kids is facing flak worldwide since a majority of kids waste that money and not saving which is the basic purpose of such allowances. So how do you know if you should give your kids pocket money or not? Here are 10 ways to decide how much is too much ?
1. Encourage saving
The basic purpose of giving a weekly or monthly allowance to your kids is to encourage them to save. So make sure, you are doing that and not just letting your kids waste money. Pocket money must fulfill its basic purpose.
2. Reward them
This is a great way to teach them respect for money and hard work. Make them earn their pocket money by letting them do simple household chores. This way they will know what it takes to earn money and they will have better regard for that.
3. Don’t listen to surveys blindly
Surveys are a continuous thing and one day they tell you it is a bad habit, next month they might be asking you to give pocket money to your kids. So don’t fall for these blind surveys.
4. Open Children’s ISA with them
These are special accounts which provide holders with interesting tax advantages and entice kids with perks and presents.
5. Online savings
If you do not want to hand away cash to your kids directly, then you can always go for online savings. Some sites allow you to open such special accounts and make automatic transfers and kids are given pre-paid cards and pin numbers. However, parents get to decide how often their kids spend that money.
6. Encourage them to work part-time
Instead of asking your kids to do household chores, you can ask your friendly neighbors to ‘hire’ your kids for some simple chores such as gardening etc. Your kids will defiantly respect that money if they don’t care about the weekly cash you hand out to them.
7. Keep a track
Just handing out money isn’t enough. You should know where that money is going. In short, you should keep a track of your children’s’ expenses and make sure they don’t go astray.
8. Be a role model
If you want your kids to respect the money you give them, then start doing that yourself. Children look up to their adults and you being their parent should set an examp0le for them to follow.
9. Decide how much to give
You should give them pocket money in moderation. Too much and they will be splurging and too less- they will be whining. So, to avoid any such situations, know about their expenditures and how much they actually need.
10. Talk to them
Talk to your kids about their needs and expenditures and then come up with your ideas about their pocket money. You have to teach them to value money all the while being in charge.
Stopping weekly allowances might not be the best idea. Instead, make them earn it.