Our kids watch everything that we do so it is so important to be role models in every avenue of their life, including the financial side.
According to a recent survey in conjunction with Citi’s support of National Teach Children to Save Day, discovered the ways parents are teaching their children about the value of money. In the survey Citi found that the majority of parents view themselves as the primary source of financial education for their kids, with parents reporting that their kids learn about money by watching them (70 percent) and talking about money together (59 percent).
When asked to evaluate how they are doing when it comes to modeling sound financial behavior, today’s parents feel that they are setting a better example for their kids than their own parents did. Still, 29 percent say their children have only a fair or poor understanding of money and saving.
Parents are taking a proactive role in the financial education of their children, with nearly 9 out of 10 parents already teaching their children about money. Top parent-child financial education activities include:
- Going to the bank (60 percent)
- Discussing financial circumstances/what parents can and cannot afford (58 percent)
- Setting up bank accounts for their children (53 percent)
Allowances Provide Opportunities for Money Lessons
Six out of ten parents give their kids an allowance and most leave financial decisions about how to spend allowance money to their children. Letting children decide for themselves how to spend their cash has its advantages; 83 percent of parents report that children value their autonomous purchases more than items purchased by their parents.
- When to start? The average age parents begin giving an allowance is 8.5 years old.
- How much? Nearly 40 percent of parents give $5 - $10 a week. Yet, another 21 percent of parents give their kids more than $15/week.
- Chores or no chores? Most parents tie an allowance to chores (69 percent) or good behavior (21 percent).
- West Coast more generous with allowance: The average allowance per child varies by region, with the western states ($11.12) likely to give more than the national average ($10.53); and parents in the Midwest ($10.09) and Northeast ($10.04) likely to give less.
- Who to ask, mom or dad? Dads are likely to give more allowance than moms ($11.53 vs. $9.44).
Parents Uncertain about Their Children’s Future
While parents are committed to positive financial role modeling, more than half of parents surveyed (56 percent) are not confident that life for their children’s generation will necessarily be better than it has been for their generation. Parents expect that their children will struggle with a number of different financial concerns as adults, including:
- 71 percent think that saving for a home will be a major concern.
- 71 percent think they’ll struggle to have enough money for major expenses like a car or education.
- 69 percent think their children will be concerned about having enough money for emergencies.
- 69 percent of parents think they will, in turn, worry about their own children’s financial future.
For tips on how to teach children about money and saving, visit Women & Co., Citi’s personal finance resource for women.
Momtrends was not paid for this post.