Despite prices of some goods in Britain falling for the first time in over half a century, parents currently face bills amounting to nearly a quarter of a million pounds to raise just one child to the age of 21.¹
Raising a child has never been cheap; in fact the basic expenditure of bringing up a child in the UK has risen by over 60% since 2003¹. Yet rather interestingly, research we conducted as part of our Disposable Income Index has found that a new generation of entrepreneurial children is emerging, and they are learning how to pay their own way.
According to Scottish Friendly’s latest savings report, one in four children are now earning on average £38 each month and nearly half a million tech-savvy children are collectively earning in excess of £12.3 million a month through the use of technology and social media.
This emerging trend is encouraging on many levels, not only because it helps alleviate household finances a little, but it teaches young children the value of work and more importantly, how to manage their money. There is no better way to adopt these essential life skills than through actively participating in the process. To quote Benjamin Franklin, ‘Tell me and I forget. Teach me and I remember. Involve me and I learn.’
The trend even has its own celebrity endorsers, the most famous of which, the Beckhams, demonstrate a surprisingly down-to-earth approach with their children, teaching them a strong understanding of money at a young age by encouraging them to work.
In the UK today, it seems that parents are increasingly looking to adopt a similar approach with their children. Nearly 40 per cent of parents are now choosing to not give their eldest child any pocket money at all, favoring instead financial rewards for work and chores completed or encouraging their children to find a job.
It’s important to teach children how to manage their money. If not, children could grow up into adults who can’t properly save, spend and budget. But teaching children the value of saving and spending wisely at an early age will serve them well as they approach adulthood. It is pleasing to see so many parents in the UK adopt this approach today. Long may it continue.
¹ The Telegraph (Average cost of raising a child in UK £230,000) 22nd January 2015