Pocket money is becoming less common among children in the United Kingdom, according to recent data. However, kids are getting creative and finding alternative ways to earn money for their needs. The NatWest pocket money index, which looks at transactions from 308,000 children using the Rooster app, shows that only 30% of families now give regular pocket money to their children, a drop of 2% from previous years. Children now receive an average of £3.78 per week, down by 10p from last year, making up just 14% of their income.
Instead of relying on pocket money, children are turning to other sources of income such as doing one-off chores and starting their own small businesses. On average, kids are making £479.96 per year (£9.23 per week) from these activities. Some popular choices include car cleaning, which now brings in an average of £3.25 (up by 32% from last year), and paper rounds, bringing in £23.10 per week (up by 2%). However, earnings from reselling have decreased by 15% to £22.62 per week.
The data also reveals where children are spending their hard-earned money, with top destinations being Amazon, Tesco, and McDonald’s, followed by Primark, Co-op, PlayStation, Xbox, Sainsbury’s, Asda, and newcomer fashion brand Shein. NatWest Rooster Money’s CEO Will Carmichael notes that children’s financial habits are evolving, with kids learning about earning money in more sophisticated ways, which is positive for their future financial confidence.
Kids are also becoming more responsible with their money, saving an average of 9.5%, almost on par with adults at 10.2%. The top reasons for saving include gaming, holidays, and future expenses.
There is a range of opinions among parents on how much pocket money to give and what to expect in return. Some experts suggest starting as early as age four to teach money management skills, while others like Sharon Olivero-Chapman prefer giving money for completing specific chores. For example, Sharon’s daughter, Harriet, 13, runs her own successful Etsy store, earning nearly £1,000.
The article also includes stories from various families across the UK, showing their unique approaches to pocket money and teaching their children about financial responsibility. Despite the decline in traditional pocket money, it is clear that children are finding new ways to earn money and learn valuable financial skills, thanks to their resourcefulness and the guidance of their parents. By adapting to these changes and using pocket money as a tool for teaching money management, children in the UK are on their way to becoming financially savvy adults.
