Pocket Money is a great way to help children understand the concept of money and budgeting. That’s the theory, but all too often kids spend the pocket money given to them by their parents and then start asking for a supplement. Which is where we as grandparents often step in.
The amount of weekly pocket money parents are giving to children has increased. On average children get £5.80 per week. The most generous, are you London parents with a whopping £7.81!
So should pocket money should be earned
One way of helping our grandchildren appreciate the value of money was to try and teach them that money is earned. When we were looking to move, we asked our Grandkids to help to. We had them research property for sale and help us organise our move. We even had them packing boxes on moving day! But even if you’re not moving, there are still plenty of chores that kids can do around your’s and their own homes to earn a few pounds. If money is constantly doled out just because your grandchild asks for it, they may think that the stuff really does grow on trees.
How to teach you grandkids to budget
When you give out pocket money, make sure you let your grandchildren know when they will get their next pocket money. That way, if they spend it all in one go, they know they will have to wait to get more. If they have no money for a few days then that’s fine. Let them learn the value of budgeting and holding back while all of their real life bills are being taken care of by Mum and Dad.
Setting a standard for future finances
A BBC study discovered that children who earn their pocket money might become better savers in the future. If you keep on giving pocket money on demand to your grandchildren, they may end up with debt problems in later life, so stick to the rules and be strict with your grandchildren and yourself.
The bank of the grandparents
The recent recession and decline in living standards means that many parents are unable to afford to give their children pocket money. A report in The Guardian showed that “nine out of ten grandparents have given some form of financial help to their grandchildren in the last two years”.
These examples are different from regular pocket money contributions. If the lack of a grandparent’s financial assistance means that a grandchild won’t be able to afford to go to university, then, yes of course they deserve this help, but always involve them in the financial decision making so they understand the value of the money they are being given. Talk to them about the hard work you had to put in to earn your money before giving it to them freely. That way, they’ll be wiser with their own money and fully appreciate the help they are being given.
Nanna Plum on Home Front is a regular blog, by a regular Greenwich Nan. Sharing experiences as a local Granny (and member of this website) she’ll be writing about everything and anything. And being completely anonymous – you never know – you could have passed her at the Bus Stop…
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