A recent survey from Danske Bank details the spending habits of younger people in Ireland. Commissioned by the bank to coincide with the launch of a new website – www.controlyourmoney.ie – which is aimed at improving the financial literacy of Irish children, the research has revealed that 80 per cent of parents give around €27 to their 12-15 year old children every month.
Almost 90 per cent of these children spend their money shopping online or on mobile phone credit, and save on average €10 a month.
The research has also revealed that only half of all parents regularly talk to their children to teach them about spending and managing their money.
Teaching financial responsibility at a younger age can be extremely beneficial for your children later on. If you have children and want to give them pocket money in a controlled manner, here are some handy tips:
Responsibility – while some kids today might expect regular pocket money to be a right rather than a privilege, you can teach your children a valuable lesson about responsibility and working to earn. Arrange a series of tasks which must be completed on a regular basis and to certain deadlines before they get their spending money. Always distinguish between regular chores around the house and those extra money earning activities – otherwise your offspring might soon look for payment for every little task they complete around the house.
Banking – get a piggy bank or open up a bank account for your children to encourage saving alongside their spending. The newfound freedoms money can bring can be too much and they may be tempted to splash the cash, so encourage them to save for something they really want.
Bail out – following on from the last tip, don’t be tempted to bail them out if they run out. Children are always going to make mistakes regarding financial independence but they’ll never learn to manage their finances if they know you’ll always be there to pick up the tab.