Kids Banking

When to start giving your child pocket money is a difficult one and varies from family to family. You could start rewarding your child(ren) when they do certain chores or some even incentivise homework and with birthdays and Christmases, your child will get to an age where they want to have some control over their own money. Cash or Card? Your child will most likely start with cash, be it from the tooth fairy, family members and a few little jobs around the house, but as they get older you may start considering a bank card for your child.

One of the main advantages is it gets them use to the banking system and learning that money is not always physical.

There are plenty of options when it comes to children’s banking, most have apps so can be monitored on your phone and also if it gets lost or stolen, there is more chance that they will get the money back, whereas with cash, if it is lost then it is likely gone forever. Prepaid Cards There are two options for children when it comes to banking, prepaid cards or children’s bank account, however only a prepaid card is available from 6 years old. For a children’s bank account, your child needs to be 11+ to apply, and so for this article we will focus more on prepaid cards, to find out more about children’s bank accounts, click here . A prepaid card works in a similar way to a bank account, but you have more control.

There will be an app which you can download so you can monitor their spending.

Some allow you to set spending limits and also limit card usage online, instore or at ATMs which is great, particularly when your child is young.

Some apps also have saving pots so your child can learn the benefits of splitting their money between what they can spend and save and some also have chore trackers, so they only get paid when the chore is completed.

The card needs to be applied for by an adult, which is one of the differences to a children’s bank account, where the child has to apply themselves.

The other main difference is it usually has a monthly fee attached to it and also some do charge per transaction, so it is worth checking before you commit.

A prepaid card is a great introduction to banking for your child and works in a similar way as a pay-as-you-go phone.

You top up the money, put it in the account and then they can only spend what is in the account and like a bank card, it is accepted in most stores both off and online and some can be used to withdraw cash at ATMs as well as checking their balance.

Sources: MoneySavingExpert

When to start giving your child pocket money is a difficult one and varies from family to family. You could start rewarding your...