Content creator Hannah Koumakis, who lives in New Zealand, explained how implementing the pocket money system (taught by her father) helped her to set long-term savings goals at 7 years of age. This enabled her to buy a car at 16 and a house at 23.

The pocket money system helped:

"...teach us the value of each dollar and to make us completely in charge of our finances from such a young age."

• to teach prioritization skills, budgeting and money management skills

"...we actually had to split off our pocket money into different accounts. We didn't just get the full $140*...we had $70 for long-term savings...which obviously left us with $70. And then we didn't just get that $70. We also had to pay $14 towards our church, which is tithe...And then we also had to put aside $20 to short-term savings...for our car. So again, at the age of seven, they were making us save for our car, which left us with $36 and $36 had to cover everything that we wanted in our life...from socks to underwear to clothing, to if we went out to McDonald's."

What do you think about this episode and Hannah's pocket money system?

Could this help with teaching your kids how to set long-term savings goals?

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*NZ dollars in 2007