Paying pocket money makes a difference

Saving habits formed early can make a life time’s difference when it comes to managing money, according to a recent survey, “Attitudes to Money” released by AMP Financial Services.

Thursday, February 12th 2009, 7:53AM

The survey explores the link between behaviour with money as children and “good “ money management as adults. The survey suggests that "Being good at handling money", means saving money regularly and paying the mortgage/or having paid off the mortgage and not having debt.

The survey suggests that putting money into the bank as a child makes us more likely to save as adults and more likely to be good at handling money. Over half of those who saved as children, 59%, say they save as adults, whereas less than half, 47% of those who did not save as children, do so now.

Significantly more than half, 64%, of adults who regularly saved as children, versus 52% of those who did not do so, rate themselves as “good” money managers.

AMP marketing manager Henry Popplewell, said starting the savings habit young is very important.

“It is very apparent that money habits instilled in children have lasting effects. Giving children pocket money isn’t enough. Encouraging them to put some away for a rainy day sets them up well for securing their financial future.” The survey reinforced the importance people place on receiving pocket money in forming their financial habits. When asked about the link between receiving pocket money as a child and their financial behaviour as an adult, 71% said they believed that it helped them better manage money as adults.

Seventy four per cent say they have no problems with paying their mortgage with a further 25% saying they always pay their mortgage but “it is a struggle.”

Those who do not have any problems paying their mortgage are more prevalent among those who regularly save as adults.

The survey showed that 33% of the population do not have debts or mortgages.

When asked about outstanding commitments, 48% say they have outstanding credit card, hire purchase or personal loan commitments and 49% say they have a mortgage.

In the survey more than half the people received pocket money as children with 83% saying they did so and of those 41% were expected to save it. Sixty per cent received it as regular pocket money.

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