What Is the Child Allowance?
The child allowance, known as קצבת ילדים (Kitzvat Yeladim) , is a monthly cash benefit paid by ביטוח לאומי (Bituach Leumi) (the National Insurance Institute) to every family with children in Israel. It is universal, meaning every resident family receives it regardless of income, employment status, or country of origin. As a new oleh with children, you are entitled to this benefit from the moment your aliyah is registered.
The allowance is paid on the 1st of each month directly to the mother's bank account by default, though families can request it be deposited to the father's account or a joint account. It continues until each child turns 18.
Current Amounts (2025)
The child allowance amount varies based on the number of children in the family. Bituach Leumi periodically adjusts these figures for inflation. As of 2025, the approximate monthly amounts are:
- First child: NIS 159/month
- Second child: NIS 159/month
- Third child: NIS 159/month
- Fourth child: NIS 159/month
- Fifth child and beyond: NIS 159/month each
Total monthly examples: a family with two children receives approximately NIS 318/month; a family with four children receives approximately NIS 636/month. These amounts are modest, but over 18 years they add up to a meaningful sum, especially when invested wisely.
Until 2017, larger families received progressively higher per-child rates. The system was equalized so that each child receives the same base amount. This change simplified the structure but reduced the allowance for larger families compared to the previous tiered system.
Eligibility
To receive the child allowance, you must meet these criteria:
- Residency: Be a resident of Israel (your aliyah registration automatically qualifies you)
- Child's age: The child must be under 18
- Registration: Your child must be registered with the Israeli Population Authority (Misrad HaPnim). Children born in Israel are registered automatically at birth. For children who made aliyah with you, registration happens as part of the aliyah process.
There is no income test and no employment requirement. Whether you earn NIS 5,000 or NIS 50,000 per month, the allowance is the same. It is also not taxable income.
How to Start Receiving the Allowance
If your children were born in Israel, the hospital files a birth notification and Bituach Leumi automatically opens a claim. You typically start receiving payments within 1-2 months of the birth without doing anything.
If you made aliyah with children, the process may require a manual claim. Visit your local Bituach Leumi branch with your Teudat Oleh, children's birth certificates (translated if needed), and your bank account details. Many olim find that the allowance begins automatically after aliyah processing, but check your bank statements in the second month. If payments have not started, file the claim proactively.
The Gemel Yeladim Savings Option
One of the most valuable features of the child allowance system is the linked savings program called גמל ילדים (Gemel Yeladim). Instead of receiving the cash directly, you can direct a portion of the allowance into a long-term investment account for each child.
Bituach Leumi deposits NIS 50 per month per child into a savings account managed by a provident fund (Kupat Gemel). Parents can choose to add a matching NIS 50 per month from the allowance, which the government then matches with an additional NIS 50. This means for just NIS 50 of your own money, your child's account grows by NIS 150 per month.
The money is invested according to the track you select (stocks-heavy, balanced, or conservative) and grows tax-advantaged until the child turns 18. At that point, the young adult can withdraw the accumulated balance. Over 18 years with moderate market returns, even the base government deposit of NIS 50/month can grow to over NIS 25,000. With the full matching contribution, the balance can reach NIS 75,000 or more.
How to Choose or Change Your Gemel Yeladim Fund
By default, Bituach Leumi assigns a fund manager. However, you have the right to choose any licensed fund manager and any investment track. To change:
- Log into your Bituach Leumi personal account online, or call the Bituach Leumi hotline at *6050
- Navigate to the Gemel Yeladim section
- Select your preferred fund manager and investment track for each child
- Changes take effect from the following month
Compare fund performance and fees before choosing. The lowest-fee fund with a stock-oriented track has historically generated the best long-term results for children with a full 18-year time horizon. Several comparison websites track Gemel Yeladim performance across all fund managers.
A Brief History of Changes
The child allowance has undergone significant changes over the decades. Understanding the history helps explain why older Israelis may give you different information about amounts:
- Pre-2003: The allowance was considerably higher, especially for larger families. Families with 5+ children received substantial monthly payments.
- 2003 cuts: Major austerity reforms (under Finance Minister Netanyahu) slashed child allowances significantly, reducing the per-child amounts and removing the progressive scaling.
- 2008-2017: Partial restoration with a tiered system where larger families received more per child.
- 2017 reform: Equalized at a flat rate per child, and the Gemel Yeladim savings program was introduced.
What to Do With the Money
NIS 159 per child is not going to cover major expenses. But treated as a long-term savings vehicle, it becomes meaningful. Here are common approaches:
- Maximize Gemel Yeladim: Opt into the matching program. The government match is essentially free money, and 18 years of compound growth transforms modest monthly deposits into a real nest egg for your child.
- Supplement monthly budget: Some families, especially during the initial adjustment period after aliyah, use the allowance to cover everyday costs. There is no shame in this, particularly while Sal Klita payments are still active.
- Dedicate to specific child expenses: Some parents funnel the allowance toward extracurricular activities (chugim), school supplies, or clothing costs.
Common Questions for Olim
Do I need to file a separate claim for each child? No. One claim covers all your children. Additional children are added as they are born or as they are registered.
What if my child is in the army at 18? The allowance stops at 18 regardless of army service. However, the Gemel Yeladim balance remains available and can continue to be invested until the child decides to withdraw it.
Is the allowance affected by my tax status? No. It is not income-dependent and is not considered taxable income. It has no effect on your tax obligations.
Can I receive the allowance retroactively for months I missed? Generally yes, if the delay was due to administrative processing. Bituach Leumi will pay arrears for the period between your eligibility date and when payments actually begin.
Key Takeaways
The child allowance is modest but guaranteed, universal, and comes with an excellent savings vehicle in the Gemel Yeladim program. Enroll in the matching program as early as possible, choose a low-fee fund with an equity-focused track for maximum long-term growth, and treat it as the foundation of your child's future savings.