he cost of living crisis has even taken a bite out of children’s piggy banks, with almost a third of parents cutting back on what they give their offspring each week.
According to the annual pocket money survey published by Halifax Bank, a third of parents (32%) have changed the amount they put in their children’s piggy banks each week from £6.48 in 2021 at £4.99 this year.
However, it’s not all bad news for Britain’s youngsters, with research also finding that although parents have reduced their spending money, they are willing to make lifestyle changes to keep children’s spending smooth.
Half (50%) of UK parents say they would sacrifice spending on their own hobbies, such as going to the pub or eating out; or forgoing personal items, including makeup and designer items (45%) to ensure they always supplement their children’s funds. Two in five (41%) also said they would stop spending on their own hobbies or spend less on weekly groceries at the supermarket (25%).
Despite this, more than a third of parents (32%) expect their children to do more activities at home to earn their pocket money this year.
Emma Abrahams, savings manager in Halifax, said: “As household costs continue to rise, some parents are having to make tough choices to adapt to the conditions they face – from cutting down on the family grocery bill to snuggling up a date or to this highly sought-after personal purchase in stores.
“Our research reveals that parents are actually protecting their children’s money during this time, with many sacrificing spending rather than cutting spending money.”
While there’s less to spend on sweets this year, parents revealed what their children spend their pocket money on, with games and sweets coming out on top (39% each), followed by toys (30%), clothes (29%). , and hobbies, ie books (28%). Interestingly, only a fifth of parents (22%) say their children are most likely to save their pocket money, proving there is room for open conversations with children about the importance savings.
Chris Payne, who is a father of triplets and has an eldest son, is feeling the pinch and the effect it has had on his family’s life.
“Like others, we are feeling the brunt of rising costs, and that means changing our lifestyles to accommodate new ways of life – but we haven’t compromised our approach to giving money pocket,” he said.
Energy bills worry UK parents the most, with research from Halifax finding that 71% of parents surveyed are the most worried about such payments; and 55% with rising food and grocery prices. More than half (58%) of parents also say they have had to reduce their savings due to the rising cost of living.
Halifax has analyzed the economic climate of the past 35 years in relation to weekly pocket money allowances to determine its impact on what parents give their children.