A third (32 per cent) of parents are paying their children to complete household chores and 18 per cent reward good behaviour at school
- 13 per cent of parents who give their children pocket money make them pay ‘tax’ while 18 per cent of parents fine their children money if they fail to carry out household chores
- Pocket money in London is 45 per cent more than the average across the UK and boys can expect to earn up to 33 per cent more than girls for carrying out household chores
New research from Santander reveals the drivers behind today’s “pocket money economy” and illustrates the ways in which the UK’s children are learning about earning money, paying taxes and receiving fines in their own homes.
While 77 per cent of parents provide their children with a basic amount of pocket money, Santander’s data also showed that ‘extra’ money is being given by a third of parents for a range of activities including helping around the home, behaving well and performing well in sports. The average amount earned in a month for these activities is £7.70 with the highest earning activity being getting to school or college on time.
But for those who step out of line and fail to carry out their duties, financial ‘fines’ can be expected with 18 per cent of parents taking money away for failing to complete household chores and 15 per cent for behaving badly at school.
Meanwhile 13 per cent of enterprising parents are applying ‘tax’ to children’s earnings to support the running of the home. A further 42 per cent of parents who pay pocket money would consider ‘taxing’ their children and believe this to be a great way to prepare them for the real world.
Differences in ‘income’ were clear across the UK with children in London being given an average of £26.70 basic pocket money against a national average of £18.36. And when it came to earning extra money, boys on average will get 33 per cent more than girls (£6.99 vs £4.67) for carrying out household chores and 50 per cent (£8.28 vs £4.18) more for good behaviour at school.
When children were asked what motivated them to complete household chores, money (43 per cent) is by far the biggest incentive with other motivators such as being given chocolate and crisps registering with just 24 per cent of children and being told they are good or getting to stay up longer appealing to only 23 per cent.
When asked about saving, 84 per cent of children who get pocket money said they like to save the money they receive from their parents (89 per cent boys vs 77 per cent girls).
Hetal Parmar, Head of Banking and Savings at Santander, said: “It’s encouraging to see how parents use financial lessons in the home to help their children get to grips with money. Teaching children about making the most of their money once they’ve earned it is also an important life skill. Our 1|2|3 Mini Current Account is designed to help children learn to manage money and pays interest of up to three per cent on balances up to £2,0002, helping children grow their hard-earned cash and take the first steps towards financial responsibility.”
For more information on Santander’s 1I2I3 Mini Current Account and other junior products please visit: www.santander.co.uk