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Pocket money

pocket; money; teenagers; punishment; chores; jobs; responsibility; savings. ;

Whether to give pocket money, and at what age, and how much to give are issues that often concern parents. There are many ways to handle this. To a large extent it depends on family values, practices and finances. There are some general points that you may like to consider in making your decisions.

The content of this topic somes from a Parent Easy Guide developed by ParentingSA. Parenting SA is a collaboration between the Women's and Children's Health Network and the Department of Education and Child Development, South Australia.


Gving pocket money

  • The main reason for giving pocket money is to help children learn to manage money while they are young and you can still guide them. It is a valuable way to teach responsibility.
  • Pocket money can help children feel that they are important members of the family because they are given part of the family's spending money.
  • It helps children to make choices. They learn that sometimes people have to wait and save up to get what they really want.
  • If you don’t have much money to spare, even a very small amount can give a child the feeling of some independence. Not giving pocket money and explaining your reasons also helps children learn about money.
  •  In some families children are given what they ask for and do not get pocket money. If this works well for your family there is no need to give pocket money. However some parents feel their children haven't really learnt about money and how to manage it with this method.  
  • Some parents put part of children's pocket money in a bank account for them. Check that the bank does not charge any fees on this amount. Some parents give pocket money and ask the child to bank some regularly.

At what age?

The age at which you start giving pocket money depends on your child and you.

Consider how well your child understands the purpose of money and that when it is spent, it is gone. Their understanding of the value of money and things like planning and saving will develop over time.

 You could check what their friends’ parents are doing but in the end it is important to do what works for you and your family.

Should it be earned?

  • Many parents believe that a certain amount of pocket money should be given to the child just because he is a member of the family and not as payment for jobs.
  • At the same time, children are expected to do some chores as part of their contribution to the family.

These two things are both important but are separate parts of belonging to the family.

  • You may decide to give a certain amount of pocket money and let your child earn a little more for some special chores, such as washing the car.

Children develop their attitudes towards money from how they see their family using it.

How much pocket money?

How much pocket money to give will depend on:

  • What you can afford.
  • What the pocket money is expected to cover.
  • The 'going rate' among other families similar to yours. If your child has a lot less than the 'going rate' she may feel hard done by.
  • If she has a lot more it can cause resentment and jealousy amongst her friends.
  • However at some stage, children need to learn that all families have different amounts of money, and that there will always be other people who have more money and others who have less. It helps children to hear that lots of money does not always mean lots of happiness.
  • The amount of pocket money a child gets usually increases as the child gets older and takes more responsibility.

What should pocket money cover?

Work out with your child what the pocket money will cover and what it will not. Talk it through and make sure your child understands. You could help them put money into envelopes or jars for the different purposes.

  • Allow your child to make some mistakes and to learn from them. Try not to ‘top up’ their pocket money, give it ‘in advance’ or lend money that they may not be able to repay. They miss out on the opportunity to learn to manage their money and live within their means.
  • In the primary school years you may decide that pocket money could cover some saving, some school lunches and some for your child to decide what they want to use it for. Be careful not to criticise their choices if you are not happy with them. Giving choice and then telling your child what to do does not develop their sense of responsibility or independence.
  • If you are giving pocket money it is important to be consistent and reliable about ‘pay days’.

Pocket money and punishment

Stopping pocket money often seems an easy answer if your child has done something wrong. Sometimes this is OK. For example, if he has broken something it may be important for him to help pay for it by giving part of his pocket money each week if this seems fair.

However taking away all of your child's pocket money, especially over a period of time, can cause a lot of resentment towards you and difficulty with friends.

Pocket money and teenagers

Teenagers are moving towards independence and it will help them to practice managing money while they still have you to guide them.

  • Depending on your teenager's maturity you might decide to give her an allowance to cover entertainment and travel costs, and perhaps clothes.
  • While you may want to say that family money is not to be spent on certain things, e.g. cigarettes, teenagers need to have some control over their money to learn valuable money skills.
  • If she makes a poor decision it is a very good way for her to learn. The first time she makes choices that see her run out of money you may come to an agreement to help. Let her know that in the future she must take the consequences.
  • Avoid always lending money and having your child owe money that may never be paid. This can reduce the opportunity for them to learn to manage their money. Debts can also cause resentments and conflicts. It might be easier to say 'No' in the first place.
  • Older teenagers often earn money from part time work. How they use this money varies from family to family. In some families there may be a need for teenagers to contribute something towards the family or their own expenses. They may pay some money towards board.

Give praise and maybe a bonus when your child manages his money well.

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The information on this site should not be used as an alternative to professional care. If you have a particular problem, see a doctor, or ring the Parent Helpline on 1300 364 100 (local call cost from anywhere in South Australia).

This topic may use 'he' and 'she' in turn - please change to suit your child's sex.

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