John Cowan - Pocket Money - Self Help - Easymix

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John Cowan - Pocket Money

Tuesday, February 07, 2012 10:55 AM

Pocket money? Why not! My kids always got pocket money from an early age. How much depends on your ideas and your budget – we paid our kids half their age ie. a ten year old got $5, but with inflation that might be too mean nowadays.

Pocket money taught consequences: when they’d spent it all there wasn’t any more – it didn’t matter how much they pleaded - when it was gone, it was gone. It was amazing how they learnt to be better savers and wiser spenders.

One strategy that worked well was a saving incentive: if they were saving for a goal that we approved of, we’d offer to subsidise them dollar-for-dollar after they had saved the first thirty dollars. They soon learnt the benefit of having a fat credit balance in their bank account. You might think this subsidy will work out very expensive for you – but think about it: for their larger purchases I paid less than half the cost (eg. for a $100 purchase, they paid $65 and I paid $35) and I probably would have ended up paying for all of it if they hadn’t saved at all.

By the way, I don’t think pocket money should be ‘wages’ for chores. Chores are a duty and should be done just because that’s what you do in a family. They can lose pocket money as a penalty if they don’t do their chores and they can earn more by doing extra, but I think it is best not to buy your child’s compliance.