What Having Unlimited Pocket Money Taught Me About Saving Money

I grew up with unlimited pocket money. I know. That sounds kinda crazy to me too—at least now as an adult. But back then, when I was a kid in school, I didn’t think anything of it. In the blissful throes of childhood without bills to pay and salaries to earn, the most important things in my life were probably my cat (still true now), High School Musical, and getting MP3s of my favourite songs into my phone from my classmates via Bluetooth.

Money was never on my mind. It’s not that I didn’t care about money or understand its value. If I were that ignorant, I would have splurged my way into having a “normal” pocket money system enforced on me to keep me in check. Here’s the thing: I kept myself in check. I never spent more than I needed and, unlike my mother, I avoided impulse buying. In our recent MoneySmart survey, we found 46% of people are actively trying to go against their parents’ bad financial habits. I would count myself in those numbers too, due to what my mum has called “reverse parenting”.

My mother never told me to avoid overspending and buying things on a whim like she did. In fact, she enabled me to do them by never putting a cap on my spending. But somehow, fed a steady diet of free-flow pocket money and with my shopaholic mother as a parental model, I learnt to save money. And it’s only now as an adult that I’ve figured out how that happened.

 

What does having unlimited pocket money look like?

In primary school, I would go to school with $2 and pay about 50 cents for a bowl of mushroom soup or baked beans at recess time (my eating habits were almost as weird as my pocket money system). That left me $1.50 in my little coin purse. When I got back home, my grandmother, who was the primary caretaker of my sister and me during weekdays, would replenish whatever I had spent. The next day, presto! I would go to school with a full $2 again. I never even saw my grandmother add the money. From my perspective, money just appeared in my magical coin purse every day.

In secondary school and beyond, receiving pocket money became much more ad hoc. My mother would send my sister and me to school before driving herself to work every day. On the car ride, she occasionally asked: “Eh, do you guys have money?”

That would spur my sister and me to dig out our wallets to check—because why would we ever know how much money we had? Sometimes we’d be broke and sheepishly tell her so. She’d then rummage through her wallet and hand us whatever “small” notes she happened to have—sometimes they were $5, and sometimes they were $50. Talk about overkill.

 

Why unlimited pocket money doesn’t encourage unlimited spending

You might be wondering, why didn’t I just spend it all?

My money habits were cultivated in primary school between the ages of 6 and 12. At that age, perhaps the biggest reason I didn’t overspend was that I felt conscious of my spending. During primary school, my grandmother was our main caregiver while our parents were away at work for the better part of the day. She was also the person who topped up our pocket money, which meant that she would know how much we’d spent at school each day.

Under our unorthodox pocket money system, it would be impossible to buy a cute trinket from the school bookshop without our grandmother finding out. Honestly, nothing would happen even if she did. She didn’t forbid us from buying ourselves things—my sister would occasionally treat herself to a cute mechanical pencil that was more pretty to look at than ergonomic or functional. She amassed a small collection over the years.

However, my grandmother did preach to us about the values of gratitude and living meaningfully from a young age. She told us we were fortunate to have a roof over our heads and enough food on the table. If that sagely figure in your life asked you why you’d spent all your pocket money that day, could you really say “Because I wanted to buy country flag erasers to win my friend” and not feel ashamed by the frivolity of it?

Because my grandmother would know how much of our pocket money we’d spent, we couldn’t spend it all. At least, not without feeling abashed at how we’d chosen to spend money we’d been entrusted with. Back then, there was simply no way a little girl could use up $2 in school buying meaningful things like food (I didn’t eat a lot) or useful stationery (my mum would buy this for us at Popular). 

No one has ever scolded my sister and I for spending money, but no one has ever had to. Just the knowledge that my grandmother would be disappointed with my buying habits was enough to deter me from buying unnecessary things. I couldn’t betray her trust like that or negate her teachings, so I only spent what I needed and understood that cute mechanical pencils were an occasional, carefully calculated indulgence.

I’ve been using the term “unlimited pocket money” to describe the unorthodox pocket money system I grew up with. But as my sister pointed out, a better term to use would be “bottomless”. You know how there are bottomless brunches and bottomless drinks in some F&B establishments? Technically, the amount you can eat and drink is unlimited. But drinks come in glasses, and food on plates. These limit your intake to 1 glass/plate at a time, making you conscious of just how much you’re consuming. These drink glasses and buffet plates were my coin purse and wallet in school, setting daily limits on my spending. 

 

Having more than you need teaches you about what you want.

Did I never want anything for myself? We’re all only human. I did have things I wanted, but my wants were never in excess. It helped that I was always pretty anti-trend. When my classmates were showing off their Billabong pencil cases, Nike water bottles and Crumpler bags, I was content using whatever random stuff people had given me or that Popular had in stock. Did I think Billabong/Nike/Crumpler stuff looked cool? Sure. But did I want to morph into one of those generic girls carrying the same stock paraphernalia? Hell no. I refused to become a clone.

So what things did I want as a kid? The truth is, I was often given more than I wanted or needed. My mother was and is a shopaholic. It’s a fairly common affliction—according to our MoneySmart survey, 1 in 4 parents were reported to overspend and shop impulsively. Once my mother began earning a certain level of income, she was able to fuel her shopping addiction further by widening the scope of her sprees to buy things for her twin daughters. Over the course of a few birthdays she would gift us each shiny new iPods, iPads, branded bags and more.

My sister and I never asked for these things. It’s not that we didn’t appreciate the gifts, but we just didn’t particularly want or need them in the first place. They just appeared on our birthday—much like how our pocket money would appear in our purses and wallets for school. That’s also why we rarely asked for things. When you have more than you need or want, you realise that you can get by on a lot less.

 

More leads to less, and less is more.

My sister and I grew up as bookworms. We were nerds and spent much of our free time outside of studying reading storybooks. My mother had a rule: She would never limit the number of books we could buy, because reading = better English = half the battle won at school and work in the future.

When I was in my teens, we would take family trips down to Kinokuniya in Ngee Ann City and spend hours pouring over the books there. Once, I remembered finding a series about horses and ranch life in Nevada that I really liked—I was a horse girl and an avid devourer of all the cowgirl-related teen fiction out there. The series was called Phantom Stallion, and it was 24 books long. Even if each book was only $10, that was $240 spent on books in one day! And you can be sure each book costs closer to $20 than $10.

I didn’t exactly feel nervous telling my mum I wanted the whole series, but I did feel bad. I think the most accurate term to use would be paiseh. But that day, with my sister’s buy-in as well on the series, we walked out of Kinokuniya with all 24 books. The recommended reading age for those books is 10 – 14 years, but I love them even now and have kept the entire collection till this day.

There were other occasions when we went to Kinokuniya and I would only want to buy 1 or 2 books. Knowing that I could have as many as I wanted didn’t make me want to want more; there was no point in trying to buy more for the sake of maximising the bottomless book budget I was given. If you’re at a buffet and there’s some food you absolutely despise, would you go and eat those dishes just to get your money’s worth? Of course not. Less is more.

 

Pocket money in school is kinda like our salaries now.

When you’re in school, most people are given a daily or weekly allowance they have to stick to. If they want to buy something more expensive, they have to save up. That’s pretty much how salaries work, just on a monthly basis instead and with adulting duties and bills to worry about.

My unlimited pocket money also served as my training wheels for receiving a salary as an adult. Yes, it was bottomless. But as I’ve spent this article explaining, it taught me how to not overspend. It was my goal every day to make sure I went home with some money left over. Sounds familiar? Essentially, that’s the concept of saving.

My bottomless coin purse cultivated in me the habit of saving money, and to this day I make sure I never spend everything that I am given. Sure, I don’t have a grandmother or mother watching what I spend anymore, but maybe that’s what becoming an adult looked like for me. I’m now that adult figure in my own life.

---

ALSO READ: How Do I Negotiate My Salary When Switching Careers?

---

 

Your pocket money rules are yours to set—at any age.

I don’t know anyone else who grew up with a bottomless wallet in school. In fact, I think the normal advice is to set a strict pocket money amount and encourage kids to save if they want to buy something for themselves. I’m sure this works. I have tons of friends who grew up with this system and they turned out fine with their spending and saving habits. 

Our parents do a lot to help us cultivate good financial habits. In our MoneySmart survey, over 3 in 5 Singaporeans told us that they had their parents to thank for getting them into the habit of saving money. It seems that most parents have success in inculcating money-saving habits in their children—whatever methods they used.

But I also have friends who aren’t as good with their money, and they blame their parents for not teaching them right. According to our MoneySmart survey, 59% of Singaporeans who stated their parents overspent reported that they did the same, while 63% who said that their parents shopped impulsively, also shop impulsively now.

At the end of the day, if you’re reading this as an adult, it doesn’t matter if you’ve picked up bad or good money habits from your parents. I think the concept of pocket money (bottomless or not) is a fantastic way to budget. That’s why it works on kids, and I’m confident it can work on adults at any age.

In some sense, because you now have access to your own money, any “pocket money” you set yourself is free-flow each month just like how mine was as a kid each day—up to the total amount you earn, of course. It can be very intimidating to manage your own money, especially when your coin purse/drinking glass/buffet plate is now several thousand dollars a month. But if my sister and I are any proof, with the right mindset, you’re going to be just fine.

 

Still think unlimited pocket money is crazy? Or is it a revolutionary parenting tip? Share this article with someone to see what they think!

---

About the author

Vanessa Nah is a personal finance content writer who pens articles on the ins and outs of savings accounts, the T&Cs of credit cards, and the ups and downs of alternative investments. She’s a researcher at heart and leaves no stone unturned when it comes to breaking down complex finance concepts and making them easy to understand for the everyday Singaporean. When Vanessa’s not debunking finance myths, you’ll find her attending dance classes, fingerpicking a guitar, or (most impawtently) fulfilling her life mission to make her one-eyed cat the most spoiled and loved kitty in the world.

---