Cash or card?

Some parents still give their children notes and coins as pocket money but many kids now have little contact with cash, and growing numbers of families have been turning to the various payment cards and apps that have emerged to serve this market.

Most of the card-and-app combos work in a broadly similar way: kids get a contactless prepaid card to use in shops and online, and (usually) at ATMs. Money is loaded on to the card, and the parents and child can monitor spending via the app. The adults can set spending rules so they stay in control, such as deciding where the card can and can’t be used. They are also notified when the card is used. Meanwhile, money can usually be split into various pots or goals.

Typically, children aged six and over can use the cards. However, many of these services charge a monthly or annual fee, although there will often be a free trial period.

A mum uses the Osper pocket money app on a mobile phone.
A mum uses the Osper app on a mobile phone. Photograph: True Images/Alamy

NatWest operates one called Rooster Money, which is now free for existing NatWest, Royal Bank of Scotland and Ulster Bank customers but costs £19.99 a year or £1.99 a month for everyone else.

Revolut offers a similar service called Revolut <18 for those aged six to 17, where you can download the app and create a free account. However, you need to have, or open, a personal Revolut account for your child to have one.

Other popular options include GoHenry, which is £3.99 a child a month; Osper, costing £2.50 a card a month; and nimbl, which is £2.49 a month or £28 a year.

There is also HyperJar, whose kids’ prepaid debit card and app offering is free, with no sign-up or monthly fees.

Pros and cons

The card and app services all work in slightly different ways, so it is worth comparing the products before deciding which one to sign up for.

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For children aged 11 or older, you may want to consider a children’s bank account. These are offered by most high street banks and don’t charge fees.

They operate in largely the same way as adult bank accounts, although children cannot go overdrawn. However, there is usually less oversight available for parents. You probably won’t be able to control how much they are spending or where they are spending it.

How much?

Once you have decided how you are going to pay your kids’ pocket money, you need to decide how much to give them.

The latest findings from NatWest Rooster Money’s annual pocket money index report, issued last month, show that kids’ average annual income has increased by 11% to £333.84 a year, or £6.42 a week. However, that average, of course, spans a wide range of ages. Sixteen-year-olds enjoyed the highest weekly payout: £12.75 on average.

Meanwhile, the most recent data from GoHenry found that parents were paying a weekly average of £7.54 a child. A breakdown showed that six-year-olds got £3.04 a week, 11-year-olds got £6.21, while 16-year-olds received £14.68 on average. It indicated that parents in London paid the most – £9.96 on average each week – followed by £8.09 for Scotland and £7.85 for the south-east.

How often?

It would appear that a growing number of children don’t get a regular fixed amount. NatWest Rooster Money said pocket money routines were becoming “far less consistent”, with 57% of kids receiving a regular allowance in 2022-23 – down from 65% the previous year – as the cost of living crisis continues.

One pound coins.
An increasing number of children do not get a regular fixed amount of pocket money. Photograph: Dominic Lipinski/PA

It reckons that instead of committing to hand over a fixed regular sum, parents have been increasingly leaning more towards one-off payments for chores, special occasions and rewarding good behaviour, whether it’s getting good results at school or simply getting homework done or “being good”.

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Jobs

Pocket money is often paid as a reward for helping out with various chores but what is the going rate for each household task?

Almost half of parents make completing chores a condition of regular pocket money, NatWest Rooster Money found. Average payments for chores included £2.46 for cleaning the car, £1.11 for helping with the shopping, 96p for doing some vacuuming and 64p for helping in the garden. However, the most commonly completed household chores were not the biggest earners: kids most frequently opted for making the bed, emptying the dishwasher, clearing the table, cleaning the bedroom and looking after a pet.

Meanwhile, GoHenry recommended a range of daily tasks, including making the bed for 20p and feeding pets for 20p, and weekly chores such as tidying the bedroom for £1 and dusting for 50p.

Those teenagers old enough to get some more lucrative side hustles going have been doing well, with many now pulling in £20-plus from things such as babysitting stints.

Closeup of a pet rabbit looking straight at the camera in a back garden
Children can earn pocket money through daily tasks, including feeding pets such as rabbits. Photograph: Paul Mansfield Photography/Getty Images

Putting money aside

Rooster Money kids saved an average of 8% (equivalent to £27.94) of their earnings over the course of last year, which was described as “an impressive feat given persistent inflation”. Examples of targets that children actually managed to reach included saving £1,000 to put into a savings account, £200 for an iPhone and £900 for a travel fund.

The television presenter and writer Konnie Huq
The presenter and children’s author Konnie Huq believes teaching children about the value of money at an early age is important. Photograph: Simone Padovani/Awakening/Getty Images

Konnie Huq, the TV and radio presenter and children’s author – who, growing up, didn’t have pocket money – said recently that teaching children from an early age about the value of money and the importance of using it wisely “is crucial, especially in these uncertain times”.

She added: “As a parent, I know I want to make sure my children are well-equipped to be financially wise and responsible in the world ahead.”


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