Teaching Our Little One The Pocket Money Concept

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Now that my daughter was about to turn a cute 7, I decided it was time to start her pocket money initiation. Of course I didn’t get anything as a kid, and I always make faces at her, telling her she gets so much more than me, to which she always gives me a cute smile, now a toothless smile too!

So coming back to pocket money, I knew I wanted to start her on the concept, but wasn’t sure how to begin. Of late, I realised she was getting smarter about money, and was understanding more about saving and talking money before buying something.

I was already preparing her to understand about simple finances, and what are her needs and wants, which is something she is also learning in her Grade II Business Studies class…hahaha…..business studies at age 7, not bad.

So there were a few things we did to make her understand the concept of money:

• ·         Taught her that money is important and should be given due respect
• ·         Also taught her that though money is important, it is not everything, and there are certain things that are more important than money
• ·         Taught her that even though we as a family may ‘have money’ it does not mean we can spend any time and without thinking
• ·         Taught her to understand that if a certain amount is spent extra, it needs to be cut down somewhere else

While these may sound really tough or complicated to teach a 5 or 6 year old, which is when we started talking money with her, when put into real life situations, it can be quite easy to understand for a kid.

Once we introduced the concept of price and money and the like, we did a few things to make her grasp the reality:

• ·         We started involving her more in our purchases
• ·         Each time we bought something for a regular purchase, like groceries and such, we would tell her how much it costs
• ·         As a family, we have a habit of comparing prices of the same thing at different places, whether at local shops, malls or even online. We took her with us to different places while looking for the best deal, and when she asked why we were visiting so many places for the same thing, we explained the reasons
• ·         Each time I bought her books, I would first sit and plan with her and also check online if we could get any good deals. She soon started spotting better deals herself, the SALE and OFF sign getting more and more known

Of course it is not possible to expect a 5 or 6 year old to understand the nitty-gritties of expenditure and saving and the entire money concept. We didn’t expect it of her, and there were many times when we, especially me, broke the rule and bought things, especially books, on impulse. This too was a lesson for our daughter, as it taught her that there may be times when you end up buying without planning, but that means that later you have to reduce that cost somewhere.

She understood some she didn’t understand more, but slowly, the concept started getting clearer.

So this is how our pocket money plan is currently working:

• ·         Each Sunday my daughter is given an allowance of INR 50
• ·         While this may sound quite less to someone, I felt this is more than enough
• ·         She is free to use that money for anything she wishes, but as a rule needs to take permission from her parents
• ·         She cannot directly give the money, it has to be an elder
• ·         She is free to use it up every Sunday, or combine some of it and use it later
• ·         She is not allowed to show it off to friends or carry it around

She is really happy that now she has REAL money in her princess wallet. Also, it’s been 2 months now that we started the pocket money concept, and she has said she wants to save it and later buy something bigger and better.

For now, I think we are sorted, will get back to you later on the money matters with a kid. In case you have started your kiddo on pocket money, do let me know what you are doing like me or differently!

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And like I always believe in and say:
'Heal the world we live in
Save it for our children' - MJ

 Happy Parenting!!!! Be good to your little one, and to the millions of little ones out there who truly need every bit of love and compassion they can get.....Be a grown up...save the little ones.... Debolina Raja Gupta