How to Budget for Your Children’s Pocket Money

How to Budget for Your Children’s Pocket Money

Most children like to have pocket money and parents like to oblige by giving it to them. It can actually be a good way to teach children about responsibility with money and how to save and manage their money. If they want to have something expensive then showing them how to not spend their money but to save it up until they have enough to buy it can be a valuable lesson. However, it can be expensive for parents to be able to afford to give their children money. It may just be that they cannot afford it at all, or that they will have to budget for it. If budgeting is the way forward, then it is worth doing it properly.

Decide how much to give them

You need to make sure that the amount that you give them is an amount that you can afford. It is no good giving them money and then going short yourself so that you cannot afford to buy them food or to put the heating on. So, you need to be sensible about how much you will give them. If you do not have a consistent income then you may have to be more flexible as you may be short of money some months compared to others. You may have inconsistent costs, perhaps quarterly or yearly bills which you need to factor in. If you have these expensive months then you may need to consider keeping money by from the previous month or not giving them anything that month at all. For the rest of the months you will need to work out how much money you will have available to give them. You may be under pressure from them to give them as much as their friends get. However, you will need to be prepared to tell them this is beyond your budget and that you can only give them what you can afford. If they make a fuss then maybe you could consider threatening that they either have what you can afford or nothing.

Pay them first

It might be easier to make sure that you have the money available that you need if you pay them it as soon as you get paid. Then you will not be tempted to spend it on other things. If you see money in your bank account you might think that it is okay to spend it and forget about the fact that you need some left to pay pocket money with. Therefore, if you pay the pocket money first then you will know that you have done it and you will not have to keep any money aside to pay for it.

Make sure they know it is flexible

It is worth making sure that the children realise that the payments could be flexible. Explain to them that if you have a financially tough month then you might be in the situation where you might not be able to give them any money. This can leave you in an awkward situation if they do chores to earn their pocket money as they may refuse to do them or they may just get annoyed with you. You might want to make it up to them when you do have the money available and if so, you could give them an IOU. Otherwise you will have to explain to them that you will just not always be able to afford it but you do appreciate them and wish that you could give them more.

It might sound like a lot to think about just so that you can give your children a few quid each week. However, if you have a lot of children then this can add up and you need to make sure that you can manage it. It will not help your children if you give them money and then are short and cannot afford to pay your loan repayments, to feed them or to put the heating on. Therefore, you need to be really careful to prioritise your spending and make sure that you are able to afford the money that you are giving to them. It is well worth talking to them carefully about your financial situation. Explain that you might not always be able to give them the money and that you are being very careful to make sure that you will not get into financial difficulties. Hopefully, they will understand especially if you show them some figures, if they are old enough. It might also be worth thinking about telling them that some children never get any pocket money so they are lucky to even get some, although that might not go down that well, particularly if they are desperate for money or teenagers as they may still say it is unfair!

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