Making the most of pocket money - why it's important
South Africans are notoriously bad at saving - would it help if our children start learning about this essential money tool at an early age?
As it's national Savings Month, Refiloe Mpakanyane raises the question of pocket money with Nikki Bush.
In an increasingly cashless society says the parenting expert, it's truly important for parents to provide kids with 'real money' experiences.
We live in a world of credit and debit cards, store accounts and internet banking and a fear of carrying real hard cash. Our children don't often get to experience money... They know that money and cards go together.Nikki Bush, Creative parenting expert
She says you can start giving your child a small amount of pocket money already from the age of three for their own 'fun' use.
They need to be given an amount of cold, hard cash... They need to experience it running out, too... when it's spent, it's gone.Nikki Bush, Creative parenting expert
That is just to spend on something frivolous - it could be going to the sweet shop, it could be going to the toy store.Nikki Bush, Creative parenting expert
The spending of the money to buy them (little things) is an investment in a future life habit of learning to use and spend your money wisely. It's about a choice, that's what I'm buying or that's what I'm saving up for.Nikki Bush, Creative parenting expert
She suggests giving them three different piggy banks - the first for saving, which teaches how to plan and how to deal with delayed gratification.
The second piggy bank would be savings for charity and the third would be used for money that can be spent at any time.
You can also help them picture a savings goal.Nikki Bush, Creative parenting expert
Bush says the next step is opening a bank account, at the age of seven or eight, when children are aware of what it means.
This also activates a savings goal, for example you could agree that an account can be opened once there's an accumulated amount of R200.
You need to almost make it a family ritual. It's a big moment, it's like going to 'big school'.Nikki Bush, Creative parenting expert
For more tips on teaching your child about money, take a listen:
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