Experts say we need to be clear and upfront about pocket money if our kids are to learn to handle money wisely. Here’s how:
1. Start a dialogue about pocket money early, around when the ‘Gimme!’ tantrums kick in at age 5 or 6, to help kids understand that they have to shell out for the Barbie Glamour Jet aeroplane they’re coveting.
2. Avoid bribery tactics like ‘You’re not getting your allowance unless you clean your room,’ says Carrie Schwab-Pomerantz, a certified financial planner. ‘An allowance should teach budgeting,’ she says. ‘It’s not a reward for completing tasks kids should do anyway, like making their bed.’
3. Reward bonuses. Schwab-Pomerantz does recommend doling out bonuses if your children do extra work, like raking leaves or washing the dog.
4. Match rand for rand. Promote long-term saving by matching their piggy-bank contributions. In other words, act like a great bank and your kids will become great savers.
Q: How much pocket money do you give your children?