We recently surveyed 500 households around Australia to check in on the pocket money habits of our younger customers. Here are the key results from our survey.
To pay or not to pay
Life moves very quickly these days and many routines of the past have fallen away in our busy lifestyles.
But it’s good to see that the concept of paying children pocket money is still going strong in Australian families.
Our survey found that 70% of kids receive regular pocket money.
This is often paid weekly and in cash to give children an early understanding of the value and importance of managing money.
Let’s hope they take these early lessons with them as they move into teenagers and young adults!
Pay now v pay later
So when is the right time to start paying children pocket money?
Our survey showed that just under half of all Australian parents believe the ages 5-7 years old is the right time to start paying up.
This is the age when mums and dads notice children becoming aware of money, budgets and the idea of spending and saving.
There are some wealthy toddlers out there though with 22% of under 5s raking in weekly pocket money!
21% have to wait until they are 8-10 years old and 10 % until they are almost teenagers.
Pay negotiations…with your kids!
How do you know how much pocket money to pay? Is there a standard format or do you just make it up as you go?
We asked the respondents to tell us how much money they pay their children and how they arrived at that number.
Almost half ( 46% ) pay between $5-10 every week. Another third ( 36% ) pay less than $5.
15% of parents have settled on $10-20 and there were a handful who pay more than $20 so it seem that around the $10 mark is pretty common.
But how do you get to that number?
Some parents said they paid the same amount as their child’s age eg $8 for an 8 year old with a $1 increase every birthday (plus it’s easy for mums and dads to remember! )
Others do it on a $1 a day plan which is also not difficult to forget!
Then there are parents who believe that different chores deserve different amounts. It might be worth $2 to dry the dishes but only 50 cents to make your bed.
Good behaviour is also rewarded which can sometimes be a bridge too far for our more boisterous junior citizens.
Cash is still king for kids
We hear a lot these days about how we are becoming a cashless society with apps, internet banking, electronic transfers and so on but when it comes to pocket money, it seems we are all a bit old fashioned.
Our survey found that in 83% of families, pocket money is paid in cash.
The general feedback from parents was that it makes money easier to understand for kids because they can see it, feel it and most importantly, count it!
Household chores? We’ll pay that!
It’s good to see that in most Australian households, parents still expect their kids to earn their keep.
Our survey found that in a huge 86% of homes, children are expected to carry out regular chores to receive their money.
Jobs probably haven’t changed much over the years, putting out the rubbish, doing the dishes, keeping rooms tidy but it’s good to see that youngsters are pitching in to help.
Pocket money- is there a gender divide?
We wanted to see if a pay gap existed between boys and girls and if one sex saved or spent more than the other.
Well, we are pleased to report none of this happens!
Of the 500 households, more than half of parents said there was no difference in the way their children used their pocket money.
Of the remainder, 19% of mums and dads said their daughters saved more, compared to 13% of boys.
And spending habits weren’t too different either. 6% of girls spend more but in 7% of households it’s the boys who are the spendthrifts.
Need tax advice? Ask your kids.
In the survey we thought we’d ask them what they thought about tax. Do they understand it? Who pays it? And, who do you pay it to?
One of our young respondents said tax is “what you have to pay the government”, another said tax is “stuff to pay when you’re grown up”.
The child who said “ it’s the government stealing money” probably won’t end up working at the Australian Tax Office while the youngster who offered this line “ when mum steals a bit of my ice cream she says it’s tax for buying it”, probably has the tax system all sorted!
What happens in your house? We’d love to hear!
Here are 7 valuable lessons  that every parent can pass onto their children when teaching them about money.
Image from news.com.au