Tip 4:
A regular allowance or “pocket money” is usually the first introduction to money for many children and their first experience with financial independence; it gives them a certain degree of control and responsibility over their own money.
An allowance gives parents an opportunity to teach early lessons in budgeting, saving and prioritising
purchases.
BUDGETING: Children should understand that they have a finite amount of money, which they need to manage in order to be able to afford their wants.
Encourage them to keep a record of how they are saving and spending their money; this will set the stage for budgeting. Initially funds can go into a piggy bank but as it grows, open a savings account.
Here are some reasons to give pocket money.
• It makes children develop a sense of independence and responsibility.
• Teaches them the value of money
• Teach them to save towards bigger goals
• Allows them to make and learn from financial mistakes before it really matters
• Paying it on time helps them learn about budgeting and planning
Some parents don’t see why pocket money should be given suggesting it breeds a sense of entitlement.
What do you think?
Did you get pocket money as a child?
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