Pocket money section for parents and children - how to save, how much you need

Play shopping with your children - you can buy play money, cheque books and credit cards. (Early Learning Centre)
Give them money to spend at the local shop - initially give them the correct money, even counting this out beforehand. Once they have mastered this and the basics of addition and subtraction introduce the idea of change.
Start with 1p pieces. Begin to develop their understanding of money by counting and spending using all your 1p pieces. It is never too early to start saving. Save all your 1p pieces in a jar and get your children to start saving by watching you save for a specific toy or treat.
When shopping and your child wants a certain cereal or packet of biscuits, look at the cost and see if the child can find a cheaper one or find an offer. Ask them to choose between having one thing or the other - a packet of biscuits to share later, or a bar of chocolate (also to share later!). Talk about value.
When saving for something yourself share this with your children - show them how you are saving - it may be you are cutting back on another non-essential item, or being careful with your money. Discuss the choices you have with your child/ren over items for the house or holidays.
Introduce them to the concept of earning. As soon as they are old enough encourage them to earn extra money by doing jobs around the house. Initially restrict these to helping in the house, with the understanding that, later on, you will expect them to do some of these chores without the financial reward!
Don't be afraid to say 'no' when a child wants something. Give your reasons and explain why they can't have something. Tell them when it is too expensive, or you haven't got enough money in the bank. Children need to understand they can't have everything they ask for.
Get them to look out for special offers or activities they can do for free in the holidays.
Introduce the idea of saving from an early age. If they want to buy something help them save their money by putting something aside each week from their pocket money, and talk about saving. As soon as you can encourage them to put money into a savings account, especially birthday money as they can then gain interest - look for the best rate and explain the system to them.
Don't forget the principle of giving as this encourages utilitarianism and shows how money can be used to benefit others, taking part in sponsorship events is a great way to start.

How much?

What for?

When do you start giving pocket money?

Extra tips for parents

10 tips for money education

Teaching money skills

Pocket Money ideas for these age groups...