Allowance or Pocket Money (as called in the UK), is a small sum of money awarded to an individual for a specific purpose. The word allowance was popularly used by the Boy Scouts of America who were paid after every session of fruit picking. Why it important to not waste your allowance or pocket money?
According to a report by the New York Times, only two-thirds of parents in the United States give their children pocket money. The average weekly allowance is estimated to be around $30 per week.
For a school-going kid, this may seem like a lot of money but for someone older, $30 is not enough. Let’s have look at a few signs that may point to the fact that you need help with managing your allowance.
Here Are the 5 Signs You Need Help With Managing Pocket Money
1) You Are Not Saving Enough at the End of the Week
Managing pocket money also involves saving a small portion at the end of the week. I would suggest that you save at least 20 percent of the total pocket money. Needless to say, you should decide how much to save based on your current expenses.
If your parents are giving you pocket money to take care of your food and travel expenses, you need to note down the estimated expense beforehand. Only then can you save more than 20 percent.
2) You Feel the Need to Impress Your Friends
If $30 is all you are getting per week, you should spend your money strictly on things you need. Do not save money so you can buy those flashy sneakers to impress your friends. Save the money, so you can use it in desperate times. Having said that, do not feel guilty to spend your pocket money on books, food, clothes, and commute.
3) You Have an Addiction
Addiction does not always point to the abuse of illegal drugs. People, in particular, teenagers get hooked to things like video games, fast food, sports, or movies. If you are addicted to one of these things, it is time to take a step back and evaluate the situation better. Think about how this addiction will affect your future life. Does it contribute to your goal? If no, then its time to let it go.
4) You Have Credit Card Debt
If along with the allowance or pocket money that you get from your parents, you feel the need to own a credit card, it is a clear sign that you need help with money. Most credit card companies offer pre-paid credit cards to younger customers. If you have credit card debt, you must be spending all your pocket money on paying off the debt. Naturally, you are going to have problems with money.
5) You Don’t Understand the Real Reason for Allowance
Most parents offer their children a weekly allowance so they can blend and socialize with other children of their age. Most children spend their spare time playing social games like pokemon cards or crazy bones. They also go out for food every once in a while. Your parents give you money so you can participate in and contribute to your social circle. This point is very important to understand.
Asking your parents for more pocket money might be the right thing to do if you can demonstrate the need. But most people who slack at money management are aware of their shortcomings. If it sounds like you, do not ask for more money from your parents. Instead, know exactly where the money is being spent.