As kids grow up, they often start to become more independent and want to have a bit of spending money of their own. This is where pocket money comes in – a small allowance given to children by their parents or guardians, and studies show that a regular source of income can help them learn about managing their finances and the value of money. But the question is: how much pocket money should kids be getting?
70% of Aussie parents and caregivers give their children pocket money, averaging $11.10 per child per week in 2024. That amount is actually slightly lower than the $12.04/week from a YouGov survey of over 2,000 parents and guardians of children aged 8-17 we carried out in 2022.
However, the average varies by age. At Kit, in October 2024, the average pocket money per week was:
Approximately 3 in 4 parents pay weekly, with the rest paying fortnightly (and a small minority paying monthly). At Kit, we recommend that as children get older and get better at resisting impulse spending, you switch from weekly to fortnightly, then monthly to help them learn to budget over longer time periods.
But all things said, there is no one-size-fits-all answer to how much pocket money you should pay. The amount of pocket money that is appropriate for a child depends on a number of factors, such as their age, what (if anything) you expect them to do to earn their pocket money, your family's financial situation, and what they’re responsible for buying with their pocket money.
For example, if they will be expected to pay for their own snacks and drinks while at school or out with friends, they might need a bit more money than if their only expenses will be buying small toys or treats on occasion.
And before your child complains about being underpaid – other children may earn more because they motivated to complete odd jobs around the house that go above and beyond a regular amount.
If your budget doesn’t allow pocket money, you can still teach your children financial capability by enabling them to make their own decisions to spend/save. Instead of paying pocket money that can be spent on anything, you could instead give them responsibility for a small part of your regular budget. For example, perhaps you give them $5 or 10 per week which is their budget every week to go to the supermarket to buy their afternoon snacks, or ingredients for their lunches. You could even give them a clothing allowance. This will help them understand key concepts like how to stick to a budget, appreciate how much things cost, and understand the power of saving up to buy in bulk, or why making things yourself might be cheaper.
It's also important to set clear expectations around what the pocket money is for, and to encourage your child to save some of it rather than spending it all right away. This can help them develop good financial habits early on, such as saving up for bigger purchases and avoiding impulse buys. The Kit App can help you do this by setting up savings Stacks and a due date to help you check in periodically on progress.
With a bit of thought and planning, pocket money can be a great tool for teaching kids about money management and helping them become financially responsible adults.
Read the T&Cs, FSG, PDS and TMD at heykit.com.au/legal and consider if Kit is right for you. Issued by Hay Limited. Fees and charges may apply. Any advice given is general in nature.