The younger generation is significantly becoming more money savvy as 61% of children in the UK between the ages of 10 and 15 use an app to manage their pocket money, according to a new report from the personal finance comparison site finder.com
Around half of 10 year olds (49%) have said they use a money app to save their pocket money, while the figure rises to over two-thirds of 15-year-olds (68%) and 71% of 14 year olds.
The past few years has seen an explosion of interest in kids using debit cards and pocket money apps. Over the last 5 years, Google search interest in the term ‘kids debit card’ has risen 227%, with a rise of 42% between 2020 and 2021 alone.
Parents are the main source of financial education
While children may increasingly be turning to the Internet to manage their money, the majority are still getting their money advice from their parents. More than 7 in 10 (72%) said that parents had given them advice on how to manage their own money.
The second most common source for information was schools, with around 1 in 5 (22%) children receiving guidance from teachers.
Despite so many kids using apps to manage their money, only 14% say they’ve learned about money management via their bank or money app provider. There is an appetite to learn though, as 64% of children are interested in learning how to manage their money via an app.
Other sources of information are the Internet (12%) and friends (10%). Worryingly, 15% said they had never received any advice on how to manage their own money or finances.
Pocket money lives on
The piggy bank may be on the way out, but pocket money certainly isn’t. A huge 92% of children surveyed said they do receive pocket money regularly. The majority of kids save some of the money they receive, with only 15% saying they don’t keep some tucked away.
Commenting on the findings, Michelle Stevens, banking specialist at finder.com said: “Getting your child a dedicated banking or money app to manage their finances is fast becoming the norm, and despite the nostalgia of putting physical money into a piggy bank, this is an exciting development.
“Money management apps have come a long way. Intuitive layouts plus robust safety features like spending limits and parental controls, enable kids to use their technological skills to manage their money in a practical and safe way.
“Our research suggests that more needs to be done around financial education, though. Having an app is one thing, but actually understanding how to manage your finances is a vital life skill. It is great to see so many parents taking the time to educate their children, and the kids themselves being keen to learn more, but it’s clear there is an opportunity for schools and the apps themselves to help teach money management.”