Children hear how adults talk about money, see how their parents count, how they pay. Therefore, it is only natural that they take an interest in them. Should I give my child pocket money? For what and at what age?
When children are denied buying a toy because it is too expensive, they often answer: “Take the money from the card!”
Seeing that adults take out bills from an ATM simply by inserting a card into it, kids begin to think that getting money is easy enough. It is important to explain to the child that money needs to be earned. And besides that, pay great attention to talking about how they should be spent. Psychologists believe that the best education for financial solvency is the ability to manage pocket money from an early age.
It is impossible to gain your own experience and learn how to manage money (spend, save, plan) without real money, in the case of children, this is pocket money. Even in kindergarten, our children are happy to play “in the store”, using pieces of paper, leaves of trees, flower petals, pebbles in the form of banknotes. Having matured, children enjoy playing business games like “Monopoly”.
Receiving and managing your own pocket money is the most effective method of financial education for children. Only through his own experience of managing money will a child be able to learn how to effectively spend, save and invest it.
Even a small, but your own personal budget gives you the skills to manage money efficiently. Parents with advice can influence this process.
First, you need to discuss with your child the essence of pocket money – what they are for, what they can do, share their own experience. Ask your child what significant acquisitions he dreams of. It can be a bicycle, roller skates, a phone, a new game, any other thing valuable to him. Calculate together how long it takes to save up for this thing. Talk about the need to give up any current spending in favor of savings. Together with him, draw up several options for a savings plan, let him choose the option that he likes best and stick to it. Be sure to come back to this conversation after a few weeks or months and discuss successes or failures.
The purpose of pocket money for a child is to enable him to learn to make decisions about his own financial resources in a real situation.
Pocket money instills the skills of budget planning, here and now the child cannot get the necessary thing for himself, and after a while he will be able to teach the children to be patient, because sometimes, in order to acquire some expensive and necessary thing, you have to save money for a long time. Also, pocket money develops self-confidence, in their own strengths, in those moments when the child himself decides what to buy, becomes “like an adult”, deciding what and how to do it. The child may be responsible for some expenses independently, depending on age, it can be school lunches, payments for cellular communications, movement in the city, gifts to friends, going to the cinema, clothes, stationery.
It will be useful to sort out the child’s spending from time to time, especially if he cannot control them on his own.
Please note that children are our copy, therefore, in order to raise a financially literate child, first of all, you should take care of your own financial literacy. Anything you recommend or tell your child about financial literacy will be an example only if you adhere to the same rules yourself.
Don’t turn money into manipulation. Money should not be seen as an incentive to behave well, to get good grades, or worse, to get paid for the chores done, but as a means of teaching a child financial skills.
Do not reward or punish your child with pocket money. The amount of money given out should not depend on grades received at school, household chores, good behavior. The student must understand: study is his duty.
The motive “five – monetary reward” leads to the fact that the child begins to get nervous if he does not receive “excellent”, worries about failure, which in turn can lead to problems and stress, sleep disturbances, loss of appetite, communication with peers is disturbed … It is not grades that need to be encouraged, but efforts. If, for example, the child made an effort and corrected the grade, if he completed all homework on a difficult subject for him. As an incentive, there can be interesting trips, excursions, going to the cinema, an entertainment center, spending time with parents, meeting friends, that is, something that is aimed at gaining new experiences.
If you want to see good grades in your child and you know that he has potential, then you can set a goal for the child that if you receive such a level of grades, you will give him some valuable gift.
The money for a good grade does not teach him to really work, but only teaches him to produce the appearance of work. At the same time, the child begins to understand that parents expect good grades from him, without having the motivation to gain knowledge. As a result, there is a high risk of developing a buy-and-sell relationship, with each family member waiting for a reward for any positive outcome of the case.
In fact, the child needs parental love and acceptance in a social environment.
Therefore, it is impossible to make the relationship between parents and children dependent on school performance. Otherwise, your child may become distant from you. It is necessary to always take into account the child’s needs, interests, pay attention to physiology and abilities and not sacrifice his childhood for the sake of grades in school.
It is important to teach the child to take responsibility, independence and choice. It is impossible for his parents to decide everything. It is important that the child learns to feel and see the results of his actions.
Parental love will be more rational and necessary if you help your child grow up prepared for life.