How much pocket money you should give children
CHILDREN are becoming savvy with their cash by stashing away about one third of their pocket money each week, new findings have revealed.
The desire to buy items including Lego, smartphones, tablets, Xboxes is top of their priority lists and it's making them carefully squirrel away their savings.
The data provided by Rooster Money, an online app which has 300,000 users across 51 currencies worldwide, holds "virtual" money allowing kids to keep track of their cash online.
Parents can withdraw money from the account and hand over sums of cash to their children.
It also found the top ways children earn quick cash includes tidying their room, looking after pets and helping with the laundry.
Rooster Money's chief executive officer Will Carmichael said using online tools to save money from a young age remains critical to ensuring kids set up good financial habits.
"Research shows that habits around money are shaped by the age of seven,'' he said.
"By giving your kids some confidence and good habits around money, understanding what it takes to be a careful spender, saving towards things and setting goals, you can help prepare them with a framework and a set of rules to make better decisions in the future."
Rooster Money statistics show from age four the average amount saved per week by Australian children is $3.99, and this steadily increases to $13.08 per week by the age of 14.
Rising Tide Financial Services' chief executive officer Chris Browne said any online tools to help kids save is great but the presence of cash is still vital.
"You do need some physical cash, it's a great way to teach them about money because unless it's their money it doesn't have as much meaning,'' he said.
"A piggy bank is good, it's hugely visual and it's also a good idea to print off a picture of the item they want, hang it on the wall and put a graph next to it and say how far along they are with their saving, it's very motivating."
Mr Carmichael said the fact society is becoming increasingly cashless was also making it harder for children to have good financial literacy.
Mr Browne also warned the amount of pocket money to give "isn't a popularity contest" it's important to just teach children about money and make them earn it through hard work.
The Commonwealth Bank's popular Dollarmites program, which has been widely used by children to stash their money, has recently come under attack for being fraudulently set up so staff could earn bonuses and meet targets.
Many financial institutions offer kids bank accounts in the hope young customers will stay with them through into adulthood when they likely require credit products.