- More than 1 in 4 parents would stop giving pocket money to their children because of financial concerns for the household
- A fifth of parents say their children top up their piggy banks by getting jobs or starting their own businesses
- 43% of parents have borrowed money from their children and 5% have not paid it back
While two thirds (66%) of parents give their children pocket money, research by Metro Bank shows that more than a quarter (26%) would stop this due to wider financial concerns. In fact, almost half of pocket money giving parents (43%) have been forced to borrow from their children, to pay for supermarket shops (34%), or pay the bills (23%) – and 5% of them are yet to pay this back.
Pocket money is a vital part of children’s early financial awareness, with 43% of parents believing pocket money is useful to teach children about finances, spending and saving, reward them for chores (23%) and support them to buy themselves treats (18%).
Children spend their pocket money primarily on food and sweets (43%), going out with friends (33%), toys (31%), saving for more expensive items (33%) and saving for holiday spending (24%). During the cost-of-living crisis, a fifth of parents report that their children have started to supplement their pocket money by entering employment (12%) or even creating their own jobs (9%).
Partnering with parent, actor and Strictly Come Dancing alumni Will Mellor, Metro Bank wants to help reinforce the importance of financial education for children. The bank’s Money Zone scheme has brought financial education to 250,000 children across the country by partnering with 2,800 schools. The scheme will be extended later in the year to include bespoke programmes for armed forces’ communities as well as to teenagers aged 16-18.
Commenting on the research Will Mellor said: “Homes across the country are feeling the squeeze. So much so that some parents are having to borrow money from their children for the weekly shop or stop giving them pocket money altogether. As a dad myself I can say that no parent would ever want to do this, particularly when Metro Bank’s research highlights the role that pocket money can play in teaching children about money. With so many children and teenagers using debit cards, rather than cash, it’s becoming harder to teach these basic financial lessons and I’m glad that Metro Bank is taking on this challenge through its Money Zone programme.”
Mona Patel, Personal finance expert at Metro Bank added: “Pocket money can be a valuable early life lesson for children as they start to develop good financial habits that will hopefully carry through into adulthood. We’ve all seen the effects of the cost-of-living squeeze on our household spending and our children are not immune from that pressure. If parents are having to prioritise paying for life’s essentials, it’s important that older children understand why this is happening. Starting financial education early is essential and something Metro Bank has been championing since we opened our doors, having now run our Money Zone education programme for 250,000 children.”
About the research
The research was carried out online by Research Without Barriers – RWB. All surveys were conducted between 14th July 2023 and 17th July 2023. The sample comprised 1,007 UK Parents of children aged 0-18. All research conducted adheres to the ESOMAR & UK Market Research Society (MRS) code of conduct (2023) . RWB is registered with the Information Commissioner’s Office and complies with the DPA (2018).