Children losing out as stagnant economy generates drop in pocket money
Over the past 25 years, the average amount of pocket money has risen by 529%. However, the amount of pocket money received has been slowly dwindling since the 2005 peak of £8.37 a week.
prepaid cards for childrenIn 2011, children aged 8-15 received a respectable £6.25 a week, whereas in 2012 they earn £5.98 – a drop of 27p, or 4%.
This fall adds up to £14.04 a year – or 23 chocolate bars, based on the fact that an average chocolate bar costs around 60p.
The number of 8-15 year olds receiving pocket money has also reduced, from 83% in 2011 to 77% in 2012.
The drop demonstrates the increasing strain on household finances amid the ongoing recession.
The research was conducted by Halifax and examined the saving and spending habits of 8-15 year olds.
Halifax has been investigating children’s pocket money since 1987, making this their 25th Anniversary Halifax Pocket Money Survey.
Whereas in 2011, the gender gap was bridged slightly, it has seen an increase this year.
In 2011, girls received 32p per week less than boys, compared to 40p the year before. However, in 2012 girls earn an average of 37p a week less than boys.
Girls receive £5.79, while boys rake in a larger £6.16. This means that boys pocket an extra £19.24 more than girls over a year.
The research also found that 67% of children aged 8-15 save at least 25% of their pocket money – and 40% keep their pocket money in a bank or building society.
Richard Fearon, Head of Halifax Savings, said: "It is encouraging to see that over two thirds of children are still saving at least a quarter of the money they get despite the fact that amount of pocket money they receive has fallen.
“Pocket money is often the first opportunity children have to manage money and it gives them valuable insight into the benefits of both short and long term saving."
An alternative way to teach your children how to budget is by giving them prepaid cards, which have money loaded on to them beforehand and so prevent overspending.