The parent’s guide to pocket money—here’s what you need to know
Trying to decide whether to give your child or teenager pocket money? Also called allowance, pocket money can be a great way for your child to learn about money.
6 min read
Trying to decide whether to give your child or teenager pocket money? Also called allowance, pocket money can be a great way for your child to learn about money. Read on for some advice on when to start giving your child pocket money and how to determine the right amount. Let’s dive in!
Approach the issue of financial management in a practical way
Empower their kids by letting them use the money any way they want
Help children understand the value of money
Some parents pay their kids when they do household chores (like washing the car or gardening) or as a reward for good grades at school. But be careful with this practice—it’s up to you to decide what children deserve to “earn money” for. If you feel that certain household chores are part of living together (washing dishes, for example), then paying your child for completing those tasks can be counterproductive.Instead, you might prefer to find small jobs your child can complete that go above and beyond what is normally expected of them. This will be different for every family, but could include extra work around the house, looking after younger siblings, and so on.
When should kids start earning pocket money—and how much?
Wondering how old your child should be before you start giving them pocket money? Be aware that, generally speaking, giving kids pocket money can be helpful from around 6 or 7 years old, when they know how to count, add and subtract. For example, you could give your child €1 per week to buy a treat, or save up for a bigger purchase in the future. Our advice is to give your young child pocket money on a weekly rather than monthly basis, because at that age, their limited patience might not hold up under such long time periods.If you prefer to wait a bit longer, you might also decide to give your child their allowance when they go to high school, as a sign of their burgeoning independence.As for exactly how much to give your teen each month, here are some popular amounts you might want to consider:
11 to 15 years—between €10 and €30 per month
15 to 18 years—between €30 and €50 per month
To get a clearer idea, here is the average amount per age group from a 2015 study by CRIOC:
14 years—around €7 per week
15 years—around €9 per week
16 years—around €10.50 per week
17 years—around €12.50 per week
According to a 2020 Poll&Roll survey, in France, 12 to 18 year olds receive an average allowance of €33 per month. To determine your exact budget, you’ll need to decide which expenses you cover and which areas the allowance should cover. In general, parents continue to pay for:
School supplies and books
Clothes and shoes
Hobbies and activities (like sport or cultural activities)
Once you determine what expenses you’ll cover as a parent, your teen can choose where and how they want to spend their pocket money. They might use it for extra expenses, like buying a new video game, the cinema, fast food, or shopping.For more info on managing money as a family, find outhow to make a family budget.
How your teenager can earn allowance
In addition to or instead of the pocket money you give them, your teen could also do odd jobs to “top up” their cash. This is also a good way to make teens learn about the value of money, and give them their first work experience—even if it’s only just a shadow of the real thing. For example, your teenager could:
Babysit or pet sit
Sell their clothes and old items to a second-hand store
Offer their services to neighbors and friends (e.g., mowing the lawn, cleaning the house, or watering the plants).
Encourage your teen to be creative when it comes to cultivating a side hustle. This creativity will benefit them in the real world, too!
The bank account that gives you more control
Spend and save with confidence, and discover a better way to manage your money
It’s not always easy to educate your teenager about money—and money can sometimes be a taboo topic. But with a few simple rules and limits, you can already help instill a few important financial values in your child. For example, you could:
Set a monthly or weekly allowance amount and stick to it, without any “advance payments”. If your child is spending all their money at once, this can be a great way for them to learn how to manage their budget better next month.
Give them pocket money on the same day each week, like every Wednesday, or at the beginning of the month. This gives your teenager benchmarks, so they know how long they have to spend the money.
Explain which purchases are dangerous and prohibited, and explain why this is the case (around alcohol, cigarettes, etc.).
Offer to “co-fund” certain purchases. Does your teenager want a €100 pair of shoes, but you’ve only budgeted €50? Suggest that they pay for the rest with their allowance. They’ll soon realize the difference between a must-have, and something that could be substituted with a better value.
Teach your teen to keep track of their spending. You could give them a nice notebook, or suggest that they download abudget management app, for example. And feel free to show them how you keep track of your own spending so they understand how to do it and why it’s useful.
Teach your teen to save money
Learning how to save money can be tricky, but it’s completely possible to teach. When you’re young, there are many temptations to spend, and it’s normal for your teenager to want to give in and indulge often. So it's up to you to let them spend, while showing them the benefits of saving—and letting them realize that non-stop spending isn’t sustainable in the long run.Does your teen want to buy the latest jacket? How about a camera? Help them calculate how soon they could buy that item with their allowance. If they saved a third of their pocket money every month, when could they buy their dream item? This exercise helps your teen figure out the difference between an impulse buy and a priority purchase that’s worth saving for.If your child receives larger sums for their birthday or Christmas, for example, consider opening a bank account for them to put that money away, so they can use it later if they don’t want to spend it all at once.Discover all our tips forteaching your kids about money.
N26, the online bank for young people
Is your teenager about to become an adult? Why not suggest that they open a freeN26 Standard account or premiumN26 Smart account when they’re 18, so they can track their expenses and income directly from their smartphone? With N26, financial management is made simple—real-time notifications for each transaction, automatic spending statistics, and the ability to save with N26 Spaces sub-accounts. Discover which N26 plan is right for you and your teen today.
From Swiss shoppers dropping €43 per person on chocolates to 64% of European shoppers opting for second-hand gifts, here’s where our money goes during the holidays.
From Swiss shoppers dropping €43 per person on chocolates to 64% of European shoppers opting for second-hand gifts, here’s where our money goes during the holidays.
