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Pocket money falls to seven year low

20th September 2010 Print

The amount of pocket money children receive has fallen over the past year, hitting a record seven year low, according to research from the Halifax.

The average amount of pocket money received in 2010 is £5.89. The gender gap has closed considerably this year with boys (£6.08) receiving almost 40 pence more than girls (£5.70). This compares to a gap of over £1 per week in 2009 with boys receiving £6.88 compared to £5.58 for girls. The gap between the amount received by older and younger children continues to close with children aged 8-11 receiving £4.57 per week and children aged 12-15 receiving £7.02 per week.

Across the nation children in Wales top the most pocket money chart at £7.77. This makes a change to from London topping the poll where children have seen a fall of almost £4.00 from £10.79 to £6.89. Those in the South West and East Anglia receive £5.05 and £5.23 respectively.

Pocket Money Paupers

Although pocket money has fallen over the past year, almost half of children (49%) think they get the right amount.  Slightly fewer children (42%) think they should get more.  Almost two fifths of children (37%) think their friends get more pocket money than them, with around a quarter (23%) thinking they get a similar amount. Almost a third (28%) never talk about the amount of pocket money they receive with their friends.

Penny Pinching rather than Saving the Pounds

A quarter (23%) of children save at least half their pocket money, compared to almost half (49%) last year.  A tenth save all of their pocket money (9%), with a sixth (13%) saving around three quarters of their weekly allowance. Almost a third (29%) do not save any of their pocket money. The average amount of pocket money saved is 37% which equates to £2.15 per week. This increases to 43% in the North East but falls to 24% in Wales.

If children do see something expensive they want, over a third (35%) will save to buy it. However, two fifths (39%) will resort to asking for the item as a Christmas or birthday present with a further sixth (18%) resorting to pester power.

Encouragingly, more than three quarters of children (77%) are interested in learning more about savings.

Flavia Palacios Umana, head of savings products at Halifax, said: "It is encouraging to see that children are still saving, despite the amount of pocket money falling. Teaching children how to manage their own pocket money is a great first step to building good financial awareness in our youngsters. Developing the habit of saving a little and often will stand them in good stead in later life as they will able to see their savings mount up over time"