Guides · Money lessons

Spend, Save and Grow

The three jars method for pocket money: what each jar is for, how to split it, and how Grow teaches interest.

The short version

Split it the moment it's paid

Payday

Split pocket money the moment it's paid: some to spend, some to save, a little to grow.

50 / 40 / 10

Start with half to Spend, 40% to Save and 10% to Grow.

4 to 7

Kids aged 4 to 7 just need Spend and Save.

+ bonus

Add a small bonus to Grow each month, so they see money earn money.

The three jars method is one of the oldest ways to teach kids about money, and one of the best. Instead of one pile of pocket money that gets spent by Tuesday, every payday is split into three places, each with its own job. The decision is made once, when the money arrives, not every time something shiny turns up.

The three jars

Spend

Theirs to use now, on whatever they like. This is where the real learning happens, including the mistakes. Spending $3 on something that breaks the next day is a cheap lesson at 7. The same lesson at 17 costs a lot more.

Save

Money for something they've chosen and can't afford yet. A goal makes saving real: "the building set" works better than "for later". Keep early goals short. Two to four weeks away is about right for younger kids, and older kids can save for longer.

Grow

Money they leave alone for a long time, which you reward with a small bonus, the way a bank pays interest. Grow teaches the idea that money left alone earns more money, the one most adults wish they'd learned sooner.

How much in each jar?

There's no perfect split, but it helps to start with one and adjust. Here are three common starting points:

Balanced50% / 40% / 10%
On $5 a week$2.50 / $2 / 50cOn $10 a week$5 / $4 / $1
Saver30% / 50% / 20%
On $5 a week$1.50 / $2.50 / $1On $10 a week$3 / $5 / $2
Mostly spend70% / 20% / 10%
On $5 a week$3.50 / $1 / 50cOn $10 a week$7 / $2 / $1

Balanced is a good default. Switch to Saver when there's a big goal in sight, or to Mostly spend for a child who's just starting out and needs to feel that pocket money is really theirs.

The jars by age

Ages4 to 7

Spend and Save

Two jars is plenty. The idea to learn is simple: spend it now, or save it for something better later. Real jars, or a picture of each one, help a lot at this age. Grow can wait, because "money that earns money" is hard to picture before 8.

Ages8 to 10

Add Grow

Now they can follow the idea of a bonus for leaving money alone. Explain it in money, not percentages: "For every $1 you keep in Grow, I'll add 5c at the end of each month."

Ages11 to 13

Real words, more say

This is the age for the real terms: interest, compound, budget. Let them have a say in their own split, and talk through what changes if they move 10% more into Save.

How a Grow bonus works

In PocketPals you choose a Grow bonus for each child. By default it's 5c for every $1 in Grow, added each month, up to $2 each time. You can make it weekly instead, and change the amount and the limit.

$20earns $1 in the first month
$21then earns $1.05
  • It compounds.The bonus lands in Grow, so next month's bonus is a little bigger. $20 earns $1 in the first month, then $21 earns $1.05. That's compound interest, in dollars and cents.
  • Taking money out pauses it.If money comes out of Grow during a month, there's no bonus that month, much like a term deposit. That makes "leave it alone" a rule they can see working.
  • The limit keeps it affordable.The $2 cap means a big Grow balance can't turn into a big bill for you.

Keeping Spend in check

Some kids let Spend pile up and then make one big impulse buy. If that worries you, set a fill-up limit for Spend. Once Spend holds that much, anything extra from payday goes to Save instead. You can also choose which spends need your OK first.

Real jars or an app?

CashThree real jars on a shelf are hard to beat for little kids.
Bank transferAn app does the sums, and kids can see their balance without counting coins.

PocketPals splits every payday for you and shows each jar on your child's screen, while the money itself stays wherever you keep it.

Common questions

What about giving?Some families add a fourth jar for giving. You can do the same by making a giving goal in Save, like "the animal shelter", and choosing together when to hand it over.
Can they move money between jars?Spend is theirs. Moving money out of Save or Grow is worth a conversation first, which is half the point: it makes them stop and think about the goal they're giving up.

For how much to give in the first place, see our pocket money by age guide.

Try a whole pocket money week, free

PocketPals suggests pocket money and jobs for each child's age, keeps count of what's done, and splits payday into Spend, Save and Grow. You pay them your usual way, cash or bank.

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Founders pay A$3 a month or A$30 a year. Cancel any time.

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