Tuesday, March 22, 2011

Kids, Pocket Money and Money Jars

Bit of a different post this one. A while ago I was watching Gail Vaz-Oxlade of 'Til Debt Do Us Part' on tv. Something that stood out to me was that kids should not be given pocket money for doing chores around the home. They're part of the family, they SHOULD help! Pocket money will help them in the long run by teaching them how to look after it, how to manage it and to save.

Gail's biggest tip was to give each child a dollar per year. I.e. my son is 10, so he gets $10. My daughter is currently 6, so she gets $6.
They each got a jar, decorated it and put their names on them. It is where their money gets stored each week. I put their pocket money aside each week, and they have an 'interview' with Dad, who gives them about 10-15 mins each to see how they're going at school, if they're making wise choices, and just to generally chat about things they're happy about, or concerned about. They love this special time with him, and look forward to it each week.

My children firstly pay 10% tithing (to our church), and they do so willingly. They know what happens to it, and don't have a problem with it. The rest is theirs to do as they like. They put some in their bank accounts, and they save some to buy things they want. I think it's important to teach them to prioritise. Saving comes before spending (I'm still figuring that out, but at least they're being taught it!!!)

My son recently saved up for 6 months to purchase a Nerf gun. He has some Nerf guns already, but he had his heart set on this big one. I bought it when it was 20% off, and he had to pay me the money before he could have it. If I REALLY wanted to teach him a lesson in real life, I could have charged him interest, but I think I'll leave that to a later date.

My daughter wanted a Barbie DVD, so I bought it and as soon as we got home she raced to her money jar to hand over her hard-saved cash. She had saved in advance to be able to do it though, she just didn't take her money to the shop (she loses it - we're working on that too).

They don't usually purchase things like this though. Generally they only use their money to purchase books via Book Club at school. It is a good way of teaching them to save, and to wait for purchases.


  1. We have a 13 year old and have found it much cheaper to give him pocketmoney of $60 a fortnight and have him pay for everything except the basics, than not give him any and have him ask for everything.

    He doesn't get extra for extra work, he just has to do the jobs we ask, like you said, part of the family. He does have specific jobs he has to do but it is not in connection with his pocketmoney.

    He saves some, $10, and the rest is his, if he wants tuckshop at school he pays (I provide lunch from home everyday), if he wants an ice cream he pays. He is into warhammer and he pays for it all.

    This has saved us as he doesn't ask for money as he knows he has to save. If he wants some special clothes he pays but we provide him with his basics.

    Turns out he is pretty good with money though sometimes runs out, but he know there is no more. When he does want something he has no problem spending though has managed to sort out what is worth his money and what is not.

    Good post, it is hard to sort out what is the right thing to do with kids.

  2. :D Thanks for that KJ. I love being able to hear how other families teach their kids about money. Each family is so different too. What works for one may not work for another. The way I'm doing things at the moment may completely fall on its head when my kids reach their teenage years, and then we will adjust accordingly. I guess the savings principles remain the same though :D