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Penny wise

Chris Davis

Whether it's to buy soft drinks, save for a special occasion or learn the value of cash,there are no fixed rules on pocket money

Pocket money is an issue that often concerns parents. To a large extent, when, whether and how depends on family values, practices and finances. Parents, educators and child welfare experts agree that there are no fixed rules when it comes to giving children pocket money.

In some cases, instead of giving pocket money, parents choose to save money on their children's behalf so it can be used to buy expensive items or a special treat.

'You can evade the problem of deciding how much pocket money to give your children by simply giving them a handout, as and when the need arises,' says Paul Tsui, father of an 11-year-old son and five-year-old daughter.

Mr Tsui, who operates a car repair service, says the advantage of a regular allowance is that it gives children experience in managing their own financial affairs.

Instead of giving a regular allowance, some parents choose to provide material rewards such as books, a trip to the cinema or clothes.

Whether children work for their pocket money (for example, by contributing to household chores) is another area where families apply different rules. Withholding pocket money for bad behaviour or providing extra money for passing exams are other topics on which opinions vary widely.

It is not a good idea to try to establish a benchmark by asking your children how much pocket money their friends receive. Children are rarely at their most reliable when talking about spending power. Ask most children how much pocket money their friends receive, and they are sure to reply that every other child in the universe receives more money than they do.

Financial planner Derek Young suggests clarifying what the pocket money is supposed to cover before deciding how much to give your children. Should it simply cover the odd treat, such as soft drinks or a comic, or should the children be expected to save money and learn to appreciate the value of it?

No two children are alike in their attitudes towards money, so avoid discussions that could turn into an emotional debate.

Thomas Tang, associate professor at the Open University of Hong Kong's School of Education and Languages, which offers child education and psychology courses, says pocket money or gifts depend on the context in which rewards are given.

'Children even as young as two or three are very perceptive and can quickly work out if money or gifts are being offered as a bribe,' he says.

Parents who spend a lot of time away from their children may over-compensate with money and gifts. Children may see this not as a caring act but as a reward for not complaining about the lack of parental presence.

The way children and teenagers interpret pocket money and gifts can vary considerably from family to family and from child to child, Dr Tang says.

'What should be cool, calm communication can become complex emotional anxiety, and also a source of manipulation. Parents are often at opposite poles, and children get mixed messages instead of good financial experience.'

Dr Tang warns that too much emphasis on rewards for exceptional school performance could turn a fun and desirable learning process into a situation where the children focus more on the money than the studies.

Li Yu-on and his wife, Marilyn, who own and operate the busy Mushroom bakery in Sai Kung, have three children, Joseph, 13, Cindy, 10, and Sandy, five. Only Joseph receives a daily allowance of $5 and an additional $20 to $30 when he goes out with friends. Joseph is also expected to help in the running of the bakery without additional reward.

'We want our children to appreciate that money is not easy to earn, that pocket money isn't an automatic right. If Joseph misbehaves, which is not often, we sometimes withhold his daily allowance, although he is such a kind boy that the loss is not just his - because he shares his allowance with others.'

Graham and Arlene Morley take a relaxed view when handing out pocket money to their three children, Abbi, 12, Krystle, nine, and Joshua, three.

The two daughters receive $20 a week and daily extras for other items. Both girls handle their money differently.

Krystle prefers to save her money to buy clothes and shoes, while Abbi usually spends hers on snacks.

The girls tidy their rooms and help with household chores without extra payment.

'As a close and loving family we enjoy sharing the household chores, and these do not require payment,' says Mr Morley, a construction manager at the Hong Kong Disneyland Hotel development.

Mrs Morley says: 'Pocket money is never given as a reward or withheld as a form of punishment. The girls have been given pocket money since they were four years old and they have a healthy respect for money.

'Although it's difficult not to offer unsolicited advice, we prefer to allow our children to spend their money in whatever way they choose. They, too, are entitled to the luxury of a little unfettered retail therapy,' she says.

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