The great piggy bank robbery
Parents with children under 18 are resorting to taking or borrowing their children's savings to help pay the bills, according to research from MoneySupermarket.
The comparison site found nearly a third (30 per cent) of parents with children under 18 have taken, or borrowed money from their child's piggy bank or savings account; two thirds of them had done so in the last twelve months.
The average amount parents took from savings was £50.26, while 16 per cent admitted to taking at least £100 from their child.
It seems the money is more crucial to parents than to their offspring's as the majority of those that dipped into their kids cash did so to help pay the bills (27 per cent), while 20 per cent said they needed it for small change, e.g. parking meters. A further 17 per cent said it was used for petrol money. Other reasons included the weekly grocery shopping (16 per cent), for a takeaway (13 per cent) and for taking their child out as a treat (13 per cent).
Kevin Mountford, head of banking at MoneySupermarket said: "It's a sign of the times when parents feeling the economic pinch have no resort but to dip into their children's savings or piggy bank. We all have moments where we need to get our hands quickly on some small change - to pay for takeaways, the milk man or a local charity collection, however it's shocking to see kids money is often needed for everyday living costs such as paying bills, money for petrol or groceries; this really indicates the financial strain households are still under as news of rising costs continue to hit consumers. In 2012, children received £5.98 in pocket money a week on average which adds up to over £300 in a year- a sizeable amount, so it's easy to see why parents may be tempted to put this towards everyday living costs.
"However, reviewing all of your outgoings to see where you can get better value and free up vital cash is essential. The savings made can literally add up to hundreds of pounds over the course of the year, a great way of giving yourself a bit of breathing room. To help boost your child's savings, and to prevent the temptation of dipping into them, locking money away in a children's savings account rather than their piggy bank is a good idea."
It seems some parents need to dip into the piggy bank more than others: 13 per cent borrow money once a week, ten per cent resort to their child's funds once a month and fourteen per cent take the cash every few months. One in ten (11 per cent) raid their kids savings on special occasions such as Christmas or summer holidays.
A quarter (21 per cent) admit to taking the cash as their children are too young to notice it missing - which is perhaps why one in five parents (21 per cent) haven't paid the money back yet and of this, only a half (58 per cent) intend to. However, the majority of ‘piggy bank raiding parents' said they have paid it all back (77 per cent), with 19 per cent giving interest back to their lucky child!
Parents are also using their children as an easy cash option, rather than having to deal with banks - 15 per cent think it's easier to borrow from their children rather than their bank or other lender, and one in ten (11 per cent) used their children's funds to avoid being stung by fees that their bank/ credit card provider would charge.
Kevin Mountford continued: "Using cash lying in a piggy bank is a good way of avoiding being stung by fees - although it is an idea to find other ways of arranging your finances to avoid these traps. It's encouraging to see that the majority of ‘piggy bank raiders' pay the money back, some even with interest on top, however it is easy to fall into a cycle of getting caught short for the next week or even month. Working out your incomings and outgoings will help you budget, and by looking to switch major bills when using MoneySupermarket, could help to save over £1,000 - a substantial contribution towards helping achieve financial goals."