Kids today earn £1,692.60 in pocket money
As a kid, getting your pocket money and deciding what to spend it on was a highlight of any week. But just how much have pocket money payments increased over time? And what are the most popular things kids spend their cash on today? We uncover this, and more.
The average kid earns £4.65 pocket money a week
The average kid earns £4.65 in pocket money every week, equating to £241.80 a year. With kids typically receiving the cash between the ages of 7-14, they could save a whopping £1,692.60 should they not spend any of it during this period.
Better still for youngsters, over a quarter of parents don’t plan to stop dishing out pocket money until kids are at least 17 and able to get a part-time job.
But it seems today’s crop fare substantially worse than their parents did when they were kids. In today’s money, current parents received a weekly average of £10.38 when they were younger – that’s equivalent to a staggering £3,778.32 over the seven years, and £2,085.72 more than their children.
Interestingly, Manchester parents give out the most pocket money on average, at £5.21 a week, followed by London. Sheffield has the lowest pocket money rate, at £3.40, followed by Norwich.
Forty-two per cent of parents surveyed said their kids earn pocket money by getting good grades, while helping out with household chores and doing their homework are also popular means of earning.
Sweets still the treat of choice
Most kids spend their pocket money on sweets and snacks, or books and magazines – although clothes are a popular choice too. Over 15% save up their pocket money to put towards bigger ticket items, like phones or games consoles.
This is similar to how their parents spent theirs, with 41% admitting they too used pocket money primarily for sweets and snacks.
How to teach your kids to spend pocket money wisely
Pocket money is reward for good behaviour and, while you want your kids to treat themselves to something they want, it’s also a great way to help them develop a healthy relationship with money early on in life.
Here are our top tips to help your kids spend responsibly, and still have fun along the way.
Teach them the importance of saving
If your kid really wants a new video game but spends their pocket money on sweets every week, there’s a real opportunity to teach them about the value of saving. If there’s something they want in particular, get them to print off a picture of it and hang it on their wall. Then you can help them to work out how long it will take to save the money.
That way, they’ll have something to work towards and will be able to make a more informed choice as to whether they want to spend some each week or put it all into savings.
Transfer their pocket money into a bank account
If you have older kids, setting them up with a bank account and debit card will help them learn how to manage their money digitally. Alternatively, you could kit them out with a prepaid card so they can’t spend more than they physically have.
Avoid giving them an advance on their money
While it can be tempting to dish out an advance on pocket money if there’s something your child really wants, they won’t really learn anything about the value of saving. If you do decide to give them an advance, draw up a repayment plan to help them learn more about lending, borrowing and paying back.
Giving your kids pocket money is not only a great way for them to discover they need to earn their cash, but also gives you chance to help them develop a healthy relationship with money; enabling them to find the perfect balance between saving and spending.
We surveyed 1,000 UK parents via TLF in March 2021 to determine how much they were gifted in pocket money compared to their kids, as well as earning and spending habits.
The retail price index was taken from the Bank of England website to calculate inflation. As the 2021 data has not yet been released, costs were converted to a 2020 equivalent price.