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Pocket money survives the recession

Pocket money survives the recession

Category: Money

Updated: 06/05/2010
First Published: 06/05/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Families up and down the land have been forced to make cut backs because of the recession, but children will be pleased to hear that pocket money has survived the cull.

Parents in the UK have maintained their commitment to giving their children money, with 68% saying they have not reduce the amount they give, despite the credit crunch, research by engage Mutual has found.

Just 7% of parents said they have reduced the amount of pocket money they give their children.

On average, young Britons are raking in some £4.08 every week in pocket money.

Children in Glasgow are the wealthiest in the UK, coining it in to the tune of £4.87 per week, or £253.24 a year on average.

If a Glaswegian child saved their money from the age of 4 until they were 18, their piggy banks would be brimming with a total of £3,545.36.

Youngsters in Newcastle and Cardiff are also benefiting from generous levels of pocket money, with parents giving them £4.67 and £4.65 per week respectively.

Encouragingly, almost two thirds (65%) of kids profess to putting aside at least part of their pocket money, fuelling hopes that the next generation will look to save rather than borrow.

A similar percentage are learning to work for their money, carrying out household chores, such as tidying their bedroom or washing the dishes.

"Parents see pocket money both as an opportunity to encourage and reward good behaviour in their children, and a means of penalising other behaviours by withholding the weekly financial contribution," said Karl Elliot at engage Mutual.

"The majority of parents surveyed tell us that they watch what their children are spending their pocket money on, and encouragingly, in addition to providing regular pocket money, 74% of parents have also set up a separate savings account for their children."

Saving for children has been thrust into the spotlight in this general election campaign.

The Liberal Democrats have proposed entirely scrapping Child Trust Funds (CTFs), while the Conservatives will scale back the initiative so that only the poorest families benefit.

The Labour Party has hit out at these plans, promising to keep CTFs as they are.

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