Parents helping the nations' children to save
Parents helping the nations' children to save
Parents have great intentions but appear to lose resolve with teenagers, when it comes to helping the nation’s children develop a savings habit, according to a recent survey, “Kids and Pocket Money “released today by AMP Financial Services (NZ).
In the survey of parents of school age children living at home, when asked about their children and money, nearly half of those who give pocket money regularly, expect their children to save. However, once children are fourteen or older, fewer parents expect they will save the money they receive.
Commenting on the survey, Jody Gill, AMP’s National Manager of Workplace Savings said the survey is a timely reminder of the benefits of starting the savings habit young.
“We all envy those friends who put money aside for the power bill and the holiday and are not fretting about their mortgage. Parents can help teach their children that what they do with their money today affects their options tomorrow, “she said.
According to the survey nearly all parents (90 per cent) said they gave their children money, and over half (56 per cent) do so as regular pocket money. Of those, nearly one in two, (42 per cent) expect their children to save some of it. A further 14 per cent give their children responsibility for certain purchases. The expectation to save is greater among parents with children aged 10 and younger. The expectation they will spend their money increases for children over 14.
The survey also shows parents give children money because they want them to learn about it. Eighty-one per cent of respondents said giving them money teaches children about the cost of items and the value of money, 80 per cent, that it teaches them to be responsible with money, and 64 per cent, that children will learn to save for things they want.
However more than a third (35 five per cent) of parents cited the “valuing money” rationale as the main reason for giving children money. This was also more prevalent as the reason among households with income between $60,000 and $80,000 annually. A further 35 per cent said that it teaches them to be responsible with money and 18 per cent said they want their children to learn to save.
Amounts of pocket money given vary according to age, rising from around $11 per month for children aged five to seven years, to around $24 per month for 14 to 18 year olds. This suggests growing financial independence for children over 14, given their increased expenses.
Other reasons cited for giving children money included “helps them learn to count”, ” teaches maths in a practical way”, “to conform to expectations of what good parents do”, “lets them decide if they really need to buy items or just want “, and ” if they have achieved something great“.
ENDS
(Note for editors: This research was conducted for AMP by Colmar Brunton in May 2008 and has a sample size of 500. The margin of error is a maximum of plus or minus 4.5%. Panellists of the Colmar Brunton CBClique panel completed the survey online. They were required to have children at school and living at home, and were invited to participate in the research to reflect national proportions on age, gender and region distribution.
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