NEW YORK — When it comes to money, most people agree they wish they knew more about finances earlier in life. In fact, a new survey finds four in five parents wish they had more information about money and financial know-how when they were children. With that in mind, many American moms and dads are making sure their kids don’t end up in the same financial corner.
The OnePoll survey of 2,000 American parents with children between eight and 14 reveals that 83 percent of those parents would have liked to learn more about finances growing up. Thirteen percent said their parents didn’t speak to them about money at all. This may have contributed to the 59 percent who still feel uncomfortable speaking about finances today.
Commissioned by Chase, the survey also finds that of those respondents, 32 percent are uncomfortable speaking about finances with their own children. More than four in five Americans (82%) are looking for additional resources to help teach their children about good financial habits and 68 percent have already had the “money talk” with their kids. The coronavirus pandemic has also pushed parents to speak more openly to their kids about money. Respondents say they are now more likely to speak about their own past financial mistakes (35%), talk to their kids more about saving (30%), and be more open about their financial situation (30%) than pre-pandemic.
The message about saving is sinking in
The poll finds these family talks may already be paying off. The survey also spoke directly to the respondents’ oldest child and 83 percent feel they already know how to handle their money responsibly. Seven in 10 parents have taken steps to instill good financial habits, with parents and kids working on saving for a goal (40%), giving kids an allowance (37%), and helping them with an entrepreneurial venture, like a lemonade stand or a babysitting gig (30%).
Researchers find there’s still work to be done however as just one in four parents have opened a savings account for their children (27%) or helped them track their spending (23%). Only 19 percent of these respondents have continued to regularly speak to their children about finances after their initial conversation.
“The reality is that kids get exposed to shopping and transactions at a much younger age, so it’s not surprising that many kids feel they know how to handle money responsibly. What we know is that in order to set up long-term healthy habits, it’s important for kids to see and experience how to manage money basics early,” says Kavita Kamdar, head of Chase First Banking, in a statement.
“We want to give kids a product that works similar to a financial health learner’s permit, allowing them the freedom to learn while giving their parents control over how they spend, save and earn,” Kamdar adds.
What’s the right allowance amount?
On average, the survey finds kids begin receiving an allowance at the age of eight, earning about $6 per week. Forty-three percent receive this in cash weekly and 32 percent receive it in cash every few weeks or every month. Unsurprisingly, youngsters think they should be earning double that amount.
Another 63 percent of parents said it would be helpful to use a mobile app to assist in managing their child’s allowance money, rather than purely giving them cash.
When asked what they do with their money, many kids showed they’re interested in planning for the future. Children were most likely to save their money, whether that was to spend on a slightly bigger purchase later (54%), in a piggy bank (40%), or in their wallet (34%). On average, the typical child surveyed has already saved about $148.
“Savings is one of the most important money habits for everyone and is a muscle you need to continue to exercise throughout your life. It’s key to financial health and it can help people recover faster from emergency expenses and life’s surprises,” Kamdar concludes.