Yes, you read that right. My kids pay Parent tax and here’s why you should to!
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How it started
It started when we lived in Bali for a year as a family – an unforgettable time full of sunshine, rice fields, and, yes, sweets. But amidst the paradise, we started this joke around “Parent Tax.” Whenever the kids got a treat I secretly wanted, l’d take a small cut – a gummy bear here, a chocolate button there. Other sweets are, of course, available.
It became a running joke, but it was rooted in something deeper. I wanted my kids to understand, from a young age, that money comes with responsibility. That not everything you earn-or receive-is entirely yours. Sound familiar!
Since moving back to the UK, the Parent Tax has evolved. Now, it’s not just sweets-it’s pocket money too; however, the purpose has grown. It’s about helping them learn budgeting, delayed gratification, asset allocation, and the value of financial literacy, all before they earn their first payslip or start a business.
Best Ways to Give Pocket Money to Kids!
There’s no one-size-fits all when it comes to giving kids money. Some prefer a weekly or monthly allowance, others tie it to tasks or behaviours. With my kids, they earn their allowance with bonus options, and pocket money is never for basic expectations-like brushing teeth or tidying their room. Those are life skills, and my bank couldn’t support a pound for every brush stroke or toy they put back.
But extra chores, additional homework, self-guided reading, or commitment to an extracurricular? That’s where the money conversation becomes a lesson in effort and reward. You’re not just giving them cash. You’re giving them a framework to understand how the world works.
Where Does the Parent Tax Go?
Here’s the fun part. I secretly invest the parent tax I get back using the investing strategy and theory unique to us -and whatever else we can reasonably add to it (Don’t tell my kids it’s a secret!). Imagine handing your child a small or large pot of money at 18 or 21, not as a gift, but as a celebration of the values they’ve already shown: discipline, patience, smart decision-making.
Whether they use it for a first car, a house deposit, a gap year to travel, starting a business, or growing their investments-it’s a meaningful way to empower them financially and emotionally. It tells them: You’ve earned this, because you’ve learned what to do with it such as the 5 habits to wealth and won’t waste it on VIP bottles on a uni night out!
I’ll leave it there assuming you have some unforgiving memories.
Why Grateful Financials Exists!
Grateful Financials was built around conversations like these. My mission is to make a meaningful impact on how families talk about money. We help people plan ahead
- for their kids
- for themselves,
- for the legacy they want to leave or live fully while they can (we’re big fans of SKling-Spending the Kids’ Inheritance, but that’s a topic for another day).
We believe childcare should reflect real life.That school ending at 3 while work finishes at 5 or 6 is a modern problem we’d like to help solve.
And we believe in helping parents put in sound financial plans and practice good money habits that their kids can adopt.
See you at the Ball
That’s why I’m proud to sponsor this year’s Knutsford charity ball. It’s not just about dressing up (though I’ll be doing that too, shout out to Rory at Hugo Boss Trafford Centre) or raising money (which we absolutely will). It’s about backing our local primary schools so they can provide the best for our children and opening up conversations that matter.
I’ll be there, babysitter booked, ready to socialise with actual adults as much as I love the babble that my kids speak some days (Does anyone know what ski bidi toilet is?), dance a little (You’ll need to encourage me I’ll be honest it’s been a while), and if you want to know more about what I do or how to start your own Parent Tax tradition, tap my shoulder and say Hi because this isn’t just what I do for work. It’s what I live for.
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The value of an investment with St. James’s Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.
Grateful Financials is an Appointed Representative of and represents only St. James’s Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority) for the purpose of advising solely on the group’s wealth management products and services, more details of which are set out on the group’s website www.sjp.co.uk/products. The ‘St. James’s Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James’s Place representatives. Grateful Financials is a trading name of Cameron McMillan.
SJP Approved 21/05/2025