Daily Research News Online no. 3246 - The Wealth of Children in Britain

The Wealth of Children in Britain

July 7 2004

British children aged 7 to 14 receive a massive £1.5 billion per annum in pocket money and handouts, according to a new report from Mintel. In total Britain's 7 - 10 year olds receive almost £417 million, while the 11 - 14 year olds receive some £1.1 billion a year.

Almost all children (83%) aged between 7 and 10 years old receive pocket money from their parents or grandparents, with three in ten (31%) receiving pocket money from both. A similar proportion (79%) of 11 - 14 year olds also receive pocket money from their parents or grandparents.

On top of this both groups get extra handouts from parents, grandparents and other relatives. For instance, around a quarter of 7 to 14 year olds say that they receive extra financial gifts from Mum and Dad to spend on whatever they want. 'In Britain consumer spending continues to rise and it is clear that children are benefiting from this trend. Parents here are increasingly likely to be generous towards their children, but for many pocket money is not enough, so they simply give them cash as and when they want or need it', comments Jenny Catlin, Consumer Analyst at Mintel.

Children aged 15 and 16 receive a further £1.6 billion in income and pocket money, bringing the total for 7 - 16 year olds up to a massive £3 billion. These older children are often more independent and are likely to have either part-time jobs or may have already left school and be on an annual income.

Amongst 7 - 10 year olds, over three in five (64%) say that they receive financial gifts from their grandparents, with half (50%) of those aged between 11 and 14 years old still getting money from their grandparents. 'It is clear that a significant amount of money now comes from grandparents. There are several reasons for this. Of course they often want to treat and spoil their grandchildren, but as people are living longer it is more likely that generations will overlap for a longer period of time, allowing grandparents to take a more active role in their grandchildren's care. What is more, mothers are often going back to work and grandparents, who may have time on their hands, can take over some of the childcare responsibilities,' comments Jenny Catlin.

Children aged between 7 and 10 years old receive an average of £3.10 a week, but one in seven (15%) claim to receive as much as £5 a week or more. 7 - 10 year olds also receive handouts from various sources - on average around £140 a year, with more than one in five (22%) receiving an extra £200 a year in addition to their pocket money.

On average, children aged 11-14 receive more than twice as much - £7.30 per week - in regular income. They also receive additional income either in the form of handouts or from a job. The average amount is £175. But one in four (24%) 11 - 14 year olds say that each year they receive £250 or more.

In terms of region children in Southern England have always been at a slight financial disadvantage as they tend to receive less pocket money than their counterparts in the North of England. Research shows this regional gap is actually widening. Those aged 7 - 10 in the South, receive just £2.84 a week, only 6% up on what they received two years ago. Those living in the North, on the other hand, receive around £3.47 - well above the national average of £3.10 a week - up some 16% on what they received in 2001. There is a similar divide for those aged 11 - 14 years old, with those in the South receiving £7.12 compared to £7.57 in the North.

Where handouts are concerned, those aged 7 - 10 living in the South again lose out by about £15 a year - they receive £130 a year extra compared to £145 in the North. The 11 - 14 year olds in the South miss out on a similar amount. 'Today there is a higher number of lower income families in the North of England, and many parents may simply want to give their children everything that they did not have when they were young,' explains Jenny Catlin.

Amongst all 7 - 16 year olds, being rich seems to be a popular aspiration, with over three in ten (62%) feeling this way. But it seems that when it comes to saving money the younger children are more discerning than older children. While between 7 and 10 years old, just over one in four (27%) say that they are no good at saving, this rises to 42% amongst the 11 - 16 year olds. Almost 60% of 7 - 10 year olds say that they actually enjoy saving money compared to only 45% of 11 - 16 year olds. Older children (40%) are also more likely than the younger ones (28%) to say that they spend money without thinking. 'A main influence on children and teens' changing spending habits results from the phenomenon of kids growing older younger. Today children tend to emulate adult behaviour at a younger age than they did in prior generations. Research shows that older children have a looser attitude toward savings and debt, a trait that we see only too often amongst many adults today. Older children tend to spend and enjoy their money, and a smaller proportion of teens save as compared to their younger counterparts,' comments Jenny Catlin.

Almost all (84%) 11 - 16 year olds purchase crisps, sweets and chocolates, making these the number one purchases for this age group. Meanwhile for younger children aged 7 - 10 the most popular products are toys and games (65%) followed by crisps, sweets and chocolate (56%). Older children become increasingly interested in toiletries, cosmetics, clothes and music. Around half of 11 - 16 year olds buy clothes and music, compared to one in three (34%) 7 - 10 year olds who buy music and fewer than three in ten (28%) who buy clothes. At this age, just 6% buy toiletries and cosmetics, but this rises dramatically to two in five (40%) amongst the 11 - 16 year olds.

'Children are important consumers through their own purchases together with the pester power they exert over their parents. But as we can see even at the young age of 11 they are already conscious of self-image, which really is something we traditionally associated with adults or older children,' comments Jenny Catlin.