«I would like more pocket money.»

«Ask Sarah!»

My name is Svenja and I would like to have more pocket money. My parents say that I am still too young to get more money. They say I wouldn't be able to manage it and would spend it all straight away. But that's not true. I have even managed to save a little over the last few months, even though I only get 25 Swiss francs a month. I read something somewhere about a youth wage. What exactly is that and how could I get it?

Svenja, 13

Dear Svenja

You raise an important issue with your wish. Because you don't just want to have more money, you want to prove that you can manage money well. This shows me that you want to take personal responsibility. I can only praise you for this: it is very important and right for young people to think about how to manage money.

In Switzerland, where many people are financially well off, there is still a high level of debt. This is particularly true among young people. Around a fifth of all young people in Switzerland are already in debt. It can start innocently enough, with you borrowing ten francs from your colleague to buy snacks. As long as you don't pay her back, you are in debt to her. What if you keep borrowing money? As you can see, it's easy to get into debt.

Debt can accumulate quickly

And the older you get, the more you might want to buy. Many shops offer the option of buying an item now but paying for it later, in instalments. This tempts many young adults to spend more than their budget allows. Instead of paying £150 all at once, for example, you only have to pay £15 per month for eleven months.

It is best to practise handling money at a young age. The youth wage is a good way to do this.

If you do the maths, you'll see that you end up paying 15 Swiss francs, or 10 per cent, more – that's the price you pay for not having to settle everything immediately. Because the individual instalments are so low, it's tempting to buy and pay for several things at once. It all sounds easy – but many people still get in over their heads and end up with high debts. For most of them, the reason is that they unfortunately did not learn enough about money when they were younger – and now they are falling into the trap.

To prevent this from happening, it is highly advisable to start managing your own money at a young age – just as you are doing. And the youth wage is a great way to do this!

That's what youth wages are all about

The aim of the youth wage is to receive a relatively high amount per month, but also to pay more yourself.

The youth wage is usually used to pay for the following items:

• Meals away from home: For example, if you don't go home for lunch and/or don't want to take homemade food with you from home...
• Clothes and shoes: More expensive items such as winter coats and shoes are often excluded.
• Hairdresser, hygiene and beauty products
• Bicycle, moped, etc.
• Public transport: Bus/train pass
• Mobile phone, mobile phone subscription
• Sport: Sports equipment, course/club fees

It quickly becomes clear that you need quite a lot of money for all this. There are guidelines that show how much you should spend on each item. You can find this list at www.jugendlohn.ch. Often, a young person's allowance is £150 or more per month, depending on the agreement and the family budget.

You can decide with your parents how much money they will give you each month and what you should use this money for. The costs of living and eating at home, insurance, family holidays, school fees and similar expenses will continue to be paid by your parents.

Suggest a six-month trial period to your parents: afterwards, you can reflect on what went well and what might still be difficult.

Learning to budget money

I think it would be great if you could discuss with your parents why you want to try earning a youth wage. The most important goal is to learn how to budget your money. You have to weigh up which expenses are necessary and which ones you want but have to put off.

Studies show that young people who receive a youth wage develop a realistic awareness of prices. They become more independent and responsible. Pro Juventute has published a brochure entitled «Money and Consumption» which provides more detailed information.

Book recommendation

Learn how to handle money in a playful way with this classic. In the form of a novel, money coach Bodo Schäfer explains the principles of building wealth: 11-year-old Kira finds an injured Labrador. She names him Money because he pricks up his ears whenever her parents talk about their money worries. Money turns out to be a real financial genius.
He knows the laws of wealth:

• How to save properly
• Investing money: the optimal strategies
• How shares and equity funds work
• Reducing debt: the 4 most important rules

With these and other financial tips, Kira can fulfil her dreams step by step and help her parents out of their financial difficulties.

Suggest a six-month trial period to your parents for now: afterwards, you can reflect on what went well and what might still be difficult. Your youth wage could also be a little lower at first, but then you would have fewer expenses to cover yourself.

With the youth wage, it is not only young people who learn – parents do too: they have to «let go» a little earlier . They should support their children and be there to help if the first steps do not work right away. The youth wage is a learning environment – mistakes are allowed.

Good luck!