Pros and Cons of Pocket Money

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There are many different views on giving or not giving children pocket money. There are also different views on if they should be required to work for that money or if it should be given as a gift with nothing required in return.

Some parents pay children an amount per week which is linked into doing certain household chores in return.  When jobs aren’t done then money is deducted or if extra jobs are done extra money is added.

The other option is that children are given a certain amount of pocket money with no jobs required.  Additional money can be earned by doing some jobs as and if required such as wash the car, mow the lawn dig the garden etc . in other words they are jobs not in the normal daily family routine.

Let’s examine the pros and cons of these two options.

Firstly paying children for all jobs they do.  The good thing about this way of doing things is that children can learn that to get paid you must work. No work – no pay. The more work you do – the more money you get.  Often though, my observations of parents who pay their children for doing jobs around the home is that teaching their children about working to get money is the last thing on their mind. It’s more about bribing them to do something the parent wants them to do.  However, something they don’t always consider is that some children can grow up with the mindset that they always have to get paid for doing something.  Doing jobs around the home voluntarily or because it is the right thing to do doesn’t enter into their head. When they are teenagers it can be very difficult when you ask them to do something for you and they reply “How much are you going to pay me?”

In my opinion I think it is best to teach children that in the home they are part of the family team. There are things like making their beds, doing dishes, taking out the rubbish, or cleaning the bathroom basin for example that are done because it helps make their family team function well.  There is no payment attached. They do it because it is the right thing to do – help their Mum or Dad, Brother or Sister.

Pocket money is then given as a totally unrelated item. It is theirs to keep and do with what they like, no strings attached, no jobs required and they get it regardless of their attitude to work around the house.  With this pocket money the parent can then teach their child the principles of dividing their money into the three categories, saving, sharing and spending and to guide them in their thinking of how to manage money wisely.

With our children we used this last system and as they grew older we increased the amount and they started paying their own way for things they wanted. By the time they left home the amount we were giving them was enough for them to buy their own clothes, pay for their own entertainment, hobbies, activities with friends, gifts for others and virtually any item that wasn’t a family essential.  The only thing we did pay for them was school fees and things we did as a family such as a family holiday or family special occasion.  Our children soon learnt that the $100.00 designer jeans got torn just as easy as the $20.00 bargain ones and that when the money was spent there was no more till the next week.

So, whatever pocket money system you choose to use with your child, try and have in mind what will be the long term benefits or effects this will have on teaching your child how to handle money.