Imagine this...Sunlight bathes the kitchen as your child's excited fingers dive into a piggy bank overflowing with coins. This classic scene, once synonymous with childhood pocket money, now shares space with sleek debit cards and budgeting apps.

But for parents, the questions remain: when to start, how much to give, and how to navigate the tricky world of saving and spending for young minds?

The answer doesn't come with a fixed age. In 2020, Young Enterprise, a financial literacy charity, found the average starting age for pocket money is seven years old and mobile phones at eight. But remember, averages are just guideposts, not strict timelines. Individual needs and family circumstances play a crucial role.

Finding the Sweet Spot: Averages and Age

Across the UK, weekly pocket money varies. NatWest's Pocket Money Index shows 6-year-olds getting around £3.94, while 16-year-olds average £12.75. However, regional differences exist, with GoHenry showing London parents giving 50% more than those in the East & West Midlands.

Pocket Money by Age (Mar 2022 to Feb 2023)

Source: Pocket Money Index, Introducing the Kids’ Economy 2022/23 - Natwest Rooster Money

Heads up! These numbers come from companies offering paid pocket money cards and apps. This might skew the averages higher than the national average, as it excludes families who may not access these services.

No surprise here: Halifax Bank reports that 9 in 10 kids get pocket money from parents, with 36% also receiving a boost from generous grandparents. Seems the Bank of Mum and Dad (and Grandparents) starts early!

Tiny Tycoons, Big Lessons: Top Money Tips

Once in eager hands, the real fun begins! Here's how young UK savers can make the most of their pocket money:

• Needs vs. Wants: Prioritise essentials like school lunches over fleeting desires. This builds responsible spending habits.
• Save, Spend, Share: Divide allowances into jars for saving, spending, and charitable donations. Kids using Rooster Money average 8% saved!
• Piggy Power vs. Plastic Pals: Start with real coins for younger children. As they mature, consider prepaid cards or budgeting apps to teach digital finance. We compare four options later on.
• Shop Smart: Plan purchases, compare prices, and avoid impulse buys. Family trips to the market can be fun learning experiences!
• Financial Fun and Games: Make learning engaging! Educational apps and games like Monopoly turn money management into a playful adventure.

Finding the Fit: Pocket Money Strategies for Every Kid

There's no one-size-fits-all approach. Consider these options:

• Fixed Allowance: Predictable and fosters independence, but may not motivate responsibility.
• Chore-Based Allowance: Teaches responsibility but can feel transactional and may not teach budgeting.
• Goal-Oriented Allowance: Reinforces goal setting and responsible spending, but requires parental guidance.
• Hybrid Approach: Combines elements for flexibility and individual needs, like a fixed allowance with bonus rewards for chores or exceeding goals. But this can require more complex management.

Growing Independence, One Coin at a Time

Pocket money is more than just pocket change; it's a stepping stone to financial literacy. By providing age-appropriate amounts and equipping them with the right tools, parents can set their children on the path to financial confidence and success.

So, let the coins clink, the budgets be made, and the savings grow. Remember, the real treasure is the skills learned along the way.

Comparison: Debit Cards and Money Apps for Kids

All four of these options come with parental controls, a debit card and an app.

Simplify the parenting hustle and empower your child's financial savvy with a top-rated pocket money app. Whether it's Rooster Money for Natwest families or another trusted platform, watch your little one blossom into a money-smart learner!