How Much Should You Give Your Children?

Financial Gifts Without Spoiling the Future

At Barnaby Cecil, one question arises more often than any other among thoughtful, affluent families:

How much should I give my children—and how do I do it without eroding their ambition or self-worth?

It’s a delicate balance; give too little and opportunities are missed; give too much, and you risk creating dependency or entitlement. 

However, a growing body of behavioural research and years of our client experience suggest a clear principle: the best gifts are those that build capability.

The Psychology of Money: What the Research Shows

1. Values Are Caught, Not Taught

A study in the Journal of Family and Economic Issues found that a child’s financial habits are more influenced by observed behaviour than by formal instruction. 

Children absorb money values from how parents spend, save, and talk about money. 

Their allowance matters—but your own example matters more.

2. The Pitfalls of ‘Unstructured Wealth'

In The Millionaire Next Door, Thomas J. Stanley coined the phrase economic outpatient care to describe regular, unearned financial support to adult children. 

His findings were stark: this kind of giving often undermines independence, increases consumption, and weakens financial literacy.

3. Purposeful Giving Encourages Resilience

Harvard Business School’s Michael Norton and others in behavioural economics show that money given with conditions, purpose, or structure has a far greater positive impact. 

Matching savings, requiring planning, or linking gifts to effort preserves intrinsic motivation and builds financial confidence.

A Framework by Age

After years of doing this work, and plenty of research, I have compiled a cheat sheet broken down by age on purposeful giving:

‍Ages 5–12: Introduce the Basics

• Offer a modest, consistent allowance.
• Use “Spend / Save / Give” jars or junior bank accounts.
• Involve children in real decisions: choosing a birthday gift for a friend or budgeting for a toy.
  
  

Ages 13–18: Controlled Independence

• Assign responsibility for small budgets (e.g., clothes or outings).
• Consider matching savings: “Save £50, we’ll add £50.”
• Let them make financial mistakes while the stakes are still low.
  
  

Ages 18–25: The Launch Phase

• Support purposeful investments: education, training, meaningful travel.
• Avoid subsidising lifestyle or luxury.
• Encourage part-time work to build work ethic and confidence.
  
  

Post-25: Strategic Gifting

• Consider helping with clear milestones: home deposits, weddings, or starting a business.
• Introduce expectations—co-investing, written plans, or financial modelling.
• Use investment tools like ISAs and pensions, or staged gifts at birth dates to preserve both capital and intent.

I have also found that, before you offer a financial gift or asset to your children, ask yourself these key questions:

• Is this building capability or creating dependence?
• Am I giving to help them, or to ease my own guilt or fear?
• Would I admire how they used this money if it had been earned?

A Client Story: Gifting with Intent

One Barnaby Cecil client gifted each of their children £10,000 at age 18. But half came with strings: they had to pitch a mini business plan—to invest, upskill, or start something. 

One child used the funds to take a coding course and launch a freelance career; the other chose a language immersion trip abroad. Both returned not only more capable, but also more grateful and grounded.

It wasn’t just the money that made the difference—it was the framework and trust that surrounded it.

Capability Is the Real Inheritance

You don’t have to choose between generosity and responsibility. Done well, financial gifting can support your children and sharpen their resilience. It can unlock opportunity without dulling motivation.

In the end, the most valuable legacy isn’t just wealth—it’s the mindset and capability to use it wisely.

If you'd like to explore a bespoke gifting strategy—whether staged lifetime gifts, family trusts, or purpose-led planning—we’re here to help.