Little Kids & Pocket Money – how it works for us.

I have no doubt in my mind that pocket-money is a good thing.  It’s a great teaching tool and really important if you want to raise financially aware kids who turn into financially switched on adults.  But just knowing that doesn’t make it easy to implement.  (Trust me I know!)

We started with pocket-money in earnest when the eldest of our pinks reached school age  - almost three years ago now.  Over those three years our approach has changed A LOT.   We’ve had to accept that the  traditional ‘single chore done all week so you can collect your pocket-money on Sunday’  doesn’t work well with young children (or maybe just for our family.)   After recognising it wasn’t working  we sat down and spent some time thinking about how to develop a more flexible approach.  It has taken a lot of trial and error but finally I think we’ve hit on a winner that works well for little people and also allows room to learn basic money skills.

For the sake of simplicity I’ll share it below in dot points.

• This chart lives on our fridge with a pen attached.
• The girls get to put a tick next to each number when they do a job
• Once they have collected 7 ticks they get pocket-money ($1.00 or $2.oo).
• It doesn’t matter how long it takes to collect the ticks.  They might get 3 one day and none the next.
• Ticks are awarded for doing a job around the house that actually helps mum  or dad.  (Putting the bin bags out, sweeping the kitchen floor, feeding the chooks, helping unload the dishwasher, clearing the table after tea).
• Ticks are also occasionally awarded for really positive behaviour.
• Ticks are not awarded for jobs you have to do to look after yourself (brushing teeth, making  your own beds, putting  your own dirty clothes away).  These things are expected – as they are in life when you’re older.
• We have a second list on the fridge with suggested jobs that are tick friendly.
• Every school holidays the girls go on a ‘Girls Day Out’ to the shops and get to spend their pocket-money.  They really look forward to this. We have lunch together and  make a big deal out of the day.
• During the term we talk about the fact that those who do extra work around the house have more money to spend.
• We  also make an effort to talk to the girls about what kinds of things they can do with their money and encourage them to save for things  (okay toys) they really want.

We’ve been using this approach for about six months now and it’s working well. It’s flexible and copes with the fact that kids learn slowly about big things like finances.  It also gives them  variety and encourages them to  ask  us if they can help.  I like that!  I also like the fact that it’s forgiving.   If one of the kids has a tantrum and refuses to be helpful (let’s be honest it happens) they aren’t going to lose out completely or feel punished.  It’s much more about cause and effect than punishment.

Do your kids get pocket-money?  How does your system work?