Meaning of Pocket Money
Pocket money, is a small amount of cash carried around on a person ‘in his pocket’.
In common parlance, pocket money refers to a small allowance given to a child, under guidance of the guardian.
Sometimes an adult dependant is also given a small allowance for sustenance.
Employees may be allotted an allowance, again for taking care of sundry expenses.
Pocket money is also an online, mobile application to plan and manage your daily expenses.
Advantages of Pocket Money
- Pocket money introduces the concept of money management to children.
- It is an indirect way for children to learn money mathematics.
- The idea is to introduce children to real-life situations e.g. shopping, etc.
- It inculcates good savings habits.
- Children learn to prioritise their needs.
- This is a good way for children to learn the art of giving, as they buy presents for their friends.
- For bigger children, it takes care of small emergencies like commute or quick snacks.
- It works as positive motivator for changing behavioural habits.
- The online and mobile application is a user-friendly software to access on your mobile phone or online device.
- It helps you maintain a ready reference accounting system for your daily expenses.
- It is helpful for a caretakers to have an allowance for the household financial management.
- It usually comes in handy for small contingencies like emergency purchases, etc.
- Pocket money also works as a significant source of savings for a family.
- Allowances in businesses make accounting simpler for small expenses.
- Such unused allowances again are a source of saving.
Disadvantages of Pocket Money
- It is important to maintain adult supervision over children’s pocket money.
- Excessive pocket money can lead to children getting spoilt.
- In bigger children, teenagers, unsupervised allowance may lead to bad habits.
- If ineffective in meeting its goals, pocket money can be a financial wastage for the family.
- It may undermine the self- respect of an adult.
- There is a risk of over-dependence on the allowance.
- It can serve as a source of manipulating the adult-dependant.
- Excessive pocket money can adversely affect business revenues.
- It can also serve as a tool for financial manipulation in businesses.
- Overdependence on the mobile application can affect your core life skills like mathematics.
- It is never a replacement for human intellect. It can give a false sense of responsibility transfer.
Pocket money serves as a vital financial tool in cases of small emergencies for financially vulnerable populations including children. The online application is a valuable tool for financial management though not a replacement for human intellect.