Research commissioned by Beyond Bank Australia has found that the oldest child is twice as likely to save more money than the youngest child.
The Farley family illustrates the findings nicely, with seven-year-old Amelia visiting the bank once a month to deposit savings while brother Lachie, five, loses money.
“Amelia first clicked with the concept of saving her money when she started school and realised that she’d need money if she wanted to buy anything from the school canteen,” said Amelia’s mother, Jodi Farley.
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“Lachie our youngest, has been the complete opposite and relies on the generosity of his sister when lining up at the school canteen,” she said.
“Amelia also regularly counts her money to make sure it is all there, while no sooner have we given Lachie his pocket money he seems to have lost it.”
Amelia said she did not want to spend all her money immediately. “Normally, what I do is save my money and then spend it when I have heaps of it,” she said.
The Beyond Bank research found that 86 per cent of children did household chores to earn pocket money.
Almost half of parents believe $5 to $10 a week is the right amount to pay, and 83 per cent pay it in cash.
Beyond Bank’s general manager customer experience, Nick May, said it was easier for children to understand money if they could see it.
“Older children tend to be more responsible, conservative and smarter about money and as you move down the pecking order, the approach to savings seems to shift, at times quite dramatically,” he said.
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Mr May said parents could help even the money score by including younger children in the banking process.
“Take them into a branch, let them see how it works and consider opening a junior savings account to promote the idea of putting your money somewhere safe where you can watch it grow,” he said.
“Parents can even things out by talking about budgeting too.”
AMP financial planner Tony Rigby has noticed that older children tended to be “more of a scrooge”, and has also noticed a gender gap.
“Often the girls tend to be a little more careful with money than they boys,” he said.
Mr Rigby said he advocated parents paying children $1 a week pocket money for every year of age, and that some should be saved and some spent.
“As they get older you give them a few more chores to do around the house. Instil those skills at a young age.”
Originally published as Older siblings save more money...Read more