My children (6 and 8) receive pocket money every Saturday: 1 and 2 euros. At least, if I don’t forget. As the money man of the house, the distribution of pocket money falls under my duties. But it’s hard for me. It doesn’t help that they get the money in cash, and I always have to look for coins. Also inconvenient, I find, is that they keep forgetting it themselves.
This is how things will never work out with my children’s financial education. If pocket money is something that can be forgotten for weeks at a time, and after a few months they will get what they want anyway, because we pay for it, what am I teaching them about the value of money? It doesn’t matter if you have money or not. That there is always enough. That saving is a useless activity. And that is contrary to my belief.
I went looking for financial parenting tips. They turned out to be scarce. It Nibud has a parenting guide. I also read the book I’ll send you a tikk of economist and mother Johanneke Mijnhardt. In it she explains quite thoroughly a whole system (in seven steps) with which you make children aware of money.
She was inspired to do this by the dissolute tick-tapping behavior of her children. Nowadays, teenagers continuously send each other and their parents payment requests via the Tikkie app. ‘These are all mini-loans that they take out with each other unnoticed,’ says Mijnhardt. If you let this happen, you put the convenience of the loan first, and not the importance of saving. She recommends “the 10 percent rule” as a way to teach impulse control, in which children always set aside 10 percent of their pocket money.
Another question I had: how much pocket money is normal? In the podcast You don’t talk about money, which I’m making with Aaf Brandt Corstius, we asked listeners this question. The many answers showed that this varies widely. 7-year-olds sometimes get 3 euros, sometimes nothing. Teenagers between 4 and 20 euros, and sometimes also clothing allowance between 50 and 115 euros. Mijnhardt advises to keep it small. Pocket money is primarily learning money, intended to make saving a habit. This is easiest done in small steps.
To a large extent, raising is living life, I always read in parenting books. Children are copy machines. If you want your children to save, apply the 10 percent rule to your own income as well. If you want your children to be thrifty, don’t be spendthrift yourself. And, when they are ready, include them in the decisions and choices you make.
A podcast listener also came up with this tip against forgetting: make pocket money vouchers. Distribute 52 at the beginning of the year, which they can hand in weekly. If they forget it once, they can hand in several at a time later. This is how you shift responsibility. Nice and easy. And educational.