Pocket Money for Kids: Finding the Right Age to Start

August 14, 2023 | 


Joanna Newman



Raising a child comes with many challenges, decisions, and joys. One of the more debated topics among parents and child development experts is at what age a child should begin receiving pocket money. Pocket money can offer children a tangible lesson in financial responsibility and independence. However, determining the right age can be tricky. This article delves into the reasons, benefits, and considerations surrounding this decision to provide guidance to parents and guardians.

Understanding the Purpose of Pocket Money

Financial Education:

Before jumping into the ´when´, it´s essential to understand the ´why´. Pocket money serves as a practical introduction to the world of finance. Children, through receiving and managing a small sum, can learn about saving, budgeting, and the value of money.

Responsibility and Independence:

Receiving pocket money teaches kids about the consequences of their choices. Do they spend it all at once, or do they save up for something bigger? Such experiences can be foundational in molding a responsible adult.

Benefits of Starting Early

Building Financial Literacy:

The earlier a child is introduced to the concept of money, the sooner they can begin building their financial literacy. With the right guidance, even a young child can grasp the basics.

Incorporating Math Skills:

Counting, addition, and subtraction become practical and fun activities. For young kids, receiving pocket money might be their first hands-on experience with math outside of school.

Teaching Delayed Gratification:

Saving up for a toy or treat teaches children about waiting and the rewards that come with patience.

When is Too Early?

Conceptual Understanding:

Very young children may not yet grasp the concept of money or its value. Giving pocket money to a toddler, for instance, may be premature as they might be more interested in the physical attributes of money rather than its value.

Loss and Mismanagement:

Younger kids are more likely to lose their money or not understand the repercussions of spending it all at once.

Considerations for the Ideal Age

Developmental Readiness:

Every child is different. Some might be ready for pocket money by age 5, while others might be better suited to start at age 8. It´s essential to gauge the individual child´s maturity and understanding.

The Amount and Frequency:

The age at which you start might also determine how much pocket money is given and how often. Younger children might benefit from a small amount given more frequently, like weekly, while older kids might be ready for a larger sum given monthly.

Tasks and Chores:

Some parents tie pocket money to household chores, turning it into an earned allowance. This strategy can begin whenever the child starts doing chores. It ties effort to reward, teaching another valuable lesson.

Potential Downsides

Creating Materialistic Values:

If not approached correctly, introducing money early might instill materialistic values in a child. It´s crucial to balance the lesson of money´s value with the understanding that it isn´t the sole source of happiness.

Overemphasis on Reward:

Tying money too strictly to tasks or achievements might lead children to expect rewards for every little thing they do. It´s essential to instill the value of intrinsic motivation alongside financial rewards.

Guiding Your Child´s Financial Journey

Open Conversations:
As you introduce pocket money, make it a point to discuss money matters with your child. Explain why they´re getting an allowance, how they can use it, and the importance of saving.

Setting Goals:
Encourage your child to set small savings goals. This could be a toy, a book, or any other small treat. This teaches them about budgeting and prioritizing.


The decision to start giving pocket money is unique to every family and child. There´s no universally right age, but understanding the reasons, benefits, and potential pitfalls can guide parents in making an informed choice. By introducing pocket money at the right age for your child, you´re not just giving them a few coins or notes; you´re giving them lessons in responsibility, value, and life skills that they´ll carry into adulthood.