Understanding Pocket Money and Allowances
When it comes to children’s finances in the UK, you’ll often hear the terms “pocket money” and “allowance” thrown around, sometimes even interchangeably. But what do these words really mean in a British context? Traditionally, “pocket money” refers to a small amount of cash given regularly—usually weekly—to children by their parents or carers. It’s meant for personal spending, teaching kids about budgeting and saving from an early age. In contrast, “allowance” is less commonly used in everyday British conversation; it tends to have a slightly broader or more formal tone, sometimes implying a set amount tied to specific responsibilities or conditions.
In most UK households, pocket money starts being given when children are around six to eight years old, although some families introduce it even earlier as soon as children start school. The idea is to help them learn the basics of handling money in a safe environment before they face real-world financial decisions. Terms and practices can differ across regions and households, but “pocket money” remains the go-to phrase for this tradition. Understanding these distinctions is key for parents looking to instil healthy financial habits while embracing local customs.
2. How Much Do UK Parents Give?
When it comes to pocket money or allowances, British families have a range of approaches, but some clear trends are emerging. According to recent surveys, the average weekly pocket money for children in the UK hovers around £6.50. However, this figure can vary considerably depending on age, region, and family income.
Average Pocket Money by Age Group
| Age Group | Average Weekly Amount (£) |
|---|---|
| 6-8 years | £3.00 |
| 9-11 years | £5.50 |
| 12-15 years | £8.20 |
| 16+ years | £12.00 |
Regional Differences Across the UK
Pocket money practices aren’t uniform across the country. Children in London and the South East typically receive higher allowances compared to those in the North or Wales. For instance, Londoners might enjoy an average of £8 per week, while children in Northern regions may receive closer to £5.
Pocket Money: Regional Averages
| Region | Average Weekly Amount (£) |
|---|---|
| London & South East | £8.00 |
| Northern England | £5.10 |
| Scotland & Wales | £5.80 |
| Midlands & East Anglia | £6.20 |
Popular Practices Among British Families
The way pocket money is distributed also differs widely. Some parents opt for weekly cash payments, while others transfer money into junior bank accounts or prepaid cards to help children learn digital money management skills early on. Many families link pocket money to chores or good behaviour, encouraging responsibility and a sense of earning.
Common Pocket Money Practices in the UK:
- Weekly cash handouts: Still popular among younger children.
- Banks and apps: Increasingly common for teenagers; apps like GoHenry or RoosterMoney let parents track spending.
- Earning through chores: More than half of parents require certain tasks to be completed before handing over the allowance.
This mix of tradition and modernity reflects how British families are adapting financial education to fit today’s world—ensuring kids learn both the value of money and practical budgeting skills from an early age.
3. Teaching Money Management Skills
One of the greatest benefits of giving children pocket money or an allowance is the opportunity to teach them practical money management skills from a young age. In the UK, where contactless payments and online shopping are increasingly common, it’s more important than ever for kids to understand the value of money and how to manage it wisely.
Introducing Budgeting Basics
Start by encouraging your child to divide their pocket money into different categories—such as saving, spending, and sharing. You might use simple jars, envelopes, or even a junior bank account to help them visualise where their money goes. This hands-on approach helps children see that money is finite and that choices must be made. Encourage them to create a weekly or monthly plan, setting aside a portion for treats while ensuring they don’t spend it all at once.
Building Saving Habits
Teaching the importance of saving is crucial. Suggest setting short-term savings goals, like buying a new book or toy, alongside longer-term ambitions such as saving for a special day out. Some parents in the UK use “matching” schemes, agreeing to top up whatever their child saves towards a particular goal—this not only boosts motivation but also reinforces the habit of putting money aside.
Encouraging Financial Responsibility
Pocket money can also be linked to certain responsibilities or chores, helping children learn that money is earned and not simply given. Discuss with your child what expenses they are expected to cover with their allowance—perhaps snacks at school or small gifts for friends’ birthdays. By letting them make spending decisions (and mistakes!), children gain real-life experience in managing a limited budget—a skill that will serve them well throughout life in the UK.
4. Cash or Card? The UK’s Digital Shift
As the UK becomes increasingly cashless, families are rethinking how children manage their pocket money or allowance. Traditional coins and notes are making way for digital options, with a surge in children’s banking apps and prepaid cards tailored to younger users. These modern solutions are not just about convenience—they’re reshaping how financial responsibility is taught at home.
The Rise of Children’s Banking Apps & Prepaid Cards
Apps like GoHenry, Revolut Junior, and Starling Kite allow parents to allocate allowances directly onto prepaid cards, monitor spending in real time, and even set savings goals. Many high street banks now offer youth accounts with debit cards, giving children a taste of independent money management under parental oversight.
Comparing Cash and Digital Allowances
| Aspect | Cash | Digital (Apps/Cards) |
|---|---|---|
| Control | Easier for parents to track visually | Detailed transaction history via app |
| Convenience | Requires trips to ATMs or shops | Instant transfers; usable online/offline |
| Security | Risk of loss/theft; hard to recover | Cards can be locked remotely; less risk carrying large sums |
| Learning Curve | Tangible; helps visualise budgeting | Teaches digital finance skills needed in modern UK life |
Pros and Cons for Families
- Pros: Digital tools offer real-time monitoring, teach children about online transactions, and prepare them for an increasingly cashless society. Parental controls provide peace of mind, and features like spending limits encourage good habits.
- Cons: Some families worry that digital money feels “invisible,” making it harder for young children to grasp its value. There are also concerns about screen time and the need for device access.
The move from coins to clicks reflects broader changes in British daily life. Ultimately, the best choice depends on your family’s comfort level and your child’s age—many opt for a blend of both worlds as they navigate the path towards financial independence.
5. Tips to Stretch Their Pounds
Helping your child make the most of their pocket money or allowance is a great way to teach lifelong financial skills. Here are some practical, British-specific tips for stretching those precious pounds:
Savvy Shopping Skills
Encourage kids to compare prices in different shops—whether it’s high street stores like WHSmith and Boots or supermarkets such as Tesco and Sainsbury’s. Teach them to look out for multi-buy offers, loyalty card points, and ‘yellow sticker’ reductions on groceries that are nearing their sell-by date.
Using Discount Cards
Take advantage of discount schemes designed for young people. For example, if your child is over 11, consider getting them an 11-15 Zip Oyster photocard for discounted travel in London. For students, the NUS Totum card offers savings on everything from food to clothing and tech. Many cinemas, museums, and attractions also offer reduced rates for children or students—always ask before paying full price.
Spotting Deals and Offers
Introduce your child to the world of cashback apps and voucher codes. Websites like VoucherCodes.co.uk and HotUKDeals are full of bargains that can help stretch their money further. Encourage them to check these sites before making any purchases online or instore.
Set Savings Challenges
Make saving fun by setting challenges—such as saving up for a favourite toy or book using only discounts and deals they’ve found themselves. This not only helps them value what they buy but also boosts confidence in handling money wisely.
Get Creative with Earning Extra
If your child is old enough, encourage small side hustles appropriate for their age, like helping neighbours with gardening or pet-sitting. These activities not only grow their income but also reinforce the value of hard work and smart spending.
By adopting these tips tailored to everyday life in the UK, children can become more mindful spenders—making every penny count while learning the value of money in a real-world context.
6. Setting Boundaries: Rules and Expectations
When it comes to pocket money or allowance in the UK, setting clear boundaries is just as important as deciding the amount. British parents often use pocket money not only to teach children about spending and saving, but also to instil a sense of responsibility. To start, agree on basic ground rules with your child. For example, decide whether pocket money is given unconditionally each week or if it should be earned through chores around the house. Common age-appropriate tasks include tidying bedrooms, helping with recycling, or walking the family dog. Clearly communicate which jobs are expected and what happens if they’re missed—will there be a deduction or will they get another chance? It’s also vital to set expectations about what pocket money should cover. In the UK, it’s typical for children to use their allowance for treats, small toys, or outings with friends rather than essentials like school lunches or uniforms. You might want to introduce weekly or monthly reviews to discuss how your child is managing their money, encouraging them to reflect on their choices and learn from any mistakes in a supportive way. By creating consistent rules and having open conversations, you’ll help your child develop good financial habits while keeping things fair and transparent for everyone involved.
