For the fourth edition of Parentdex, we surveyed 5,000 parents across the nation on their attitudes towards pocket money. What is the spending power of today’s children? How much are they receiving in pocket money, and are grandparents helping out too? These are just some of the questions we wanted to delve into to find out the relationship UK children have with their pocket money.
Previous Parentdex Reports: parents' thoughts on the economy
Read our initial Parentdex report on parents' attitudes towards childcare
Read the guideShining a light on today’s pocket money landscape has revealed that the spending habits of children today are somewhat more sophisticated than back in the day – a far cry from the days of bouncy balls and yoyos. Not only this, but today’s youngsters are also richer than ever, with a collective spending power of £3.9billion every year.
Where is all this extra cash coming from? Well, Mums and Dads across the country give their children an average of £23 per month, arming your little ones with an average total of £276 to spend every year. It doesn’t stop there either. Regular payments from the Bank of Gran and Grandad also provide another stream of income which, when paired with additional ad hoc top ups from parents, is continuing to keep the bank balances of the younger generation very healthy.
What’s more, you also told us that children in the UK have amassed some impressive savings, with the average child having an average of £982.50 stashed away in a savings account – a positive sign for the future, showing that a significant number of children are choosing to save rather than spend.
In the absence of regular financial education at schools, this could be down to your discussions at home, with nine in 10 of the parents polled stating that they had talked about financial management with their children.
For some of you though, this expenditure is causing a drain on the household budget and is causing some parents to dip into their children’s piggybanks as a result.
Reflecting the strain rising costs are having on the household budget more broadly, almost a fifth of those parents had borrowed money to cover the cost of groceries, whilst a sixth had done so in order to cover childcare.
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Compare the Market
“Fortunately for kids, the wider squeeze on the household budget seems to have had little impact on the generous amounts parents wants to give their children. That said, parents do need to ensure that they are able to give their kids this pocket money, without needing to dip into it to cover wider household bills.
"It’s incredibly encouraging however to see the number of parents who are willing to talk to their children about financial management from such an early age and – with the research showing that so many children are choosing to save, rather than spend – this is clearly having a positive impact. Not only will this do more to prepare them for financial responsibility in the long run, but it should also help to lessen their long-term dependence on the Bank of Mum and Dad as a result!”
As part of the first Parentdex report, comparethemarket.com canvassed parents across the nation for our first ever Parentdex. As high inflation rates continue to dominate headlines, British parents echo their econmic concerns. Read the report here.
