Pint-sized pay cut: Kids caught in cost of living crossfire
Families are in cost-cutting mode and pocket money is on the chopping block, according to new research by Finder.
According to Finder's Parenting Report 2023, which surveyed 1,033 Australian parents of children under 12, thousands of Aussie families have docked their children's allowance as they struggle with the cost of living.
The research found 1 in 10 (11%) parents admit their kids received a pay cut this year – that's more than 280,000 families who have decreased their children's pocket money in the past 12 months.
The average weekly allowance sits at $8 – down from $10 a year ago – an estimated $39.6 million paid to Aussie children this year.
Kids in New South Wales are the nation's top-earning children, with an average weekly allowance of $11, followed by Queensland ($8) and Western Australia ($7).
Sarah Megginson, money expert at Finder and a mother of 3, said families are having to curb pocket money to cushion rises in other areas.
"Parents have less money to spend due to inflation and are having to rethink how they reward their kids for doing chores.
"Some parents are having to turn to new 'currencies' like extra screen time to encourage youngsters to help around the house."
Just under 2 in 3 (60%) parents admit their kids only receive pocket money based on the condition they do their chores.
Top chores include cleaning their room (40%), doing the dishes (30%), helping with the laundry (20%) and taking out the rubbish (19%).
Megginson said pocket money is a good way to instil healthy financial behaviours from a young age.
"It's a great way to incentivise kids to contribute to the household, and it's also the first opportunity for children to learn how to manage their money before they get a part-time job.
"Help your child to set up a kids savings account so they benefit from compound interest from a young age," Megginson said.
Some Aussie families (16%) have given their children an increase in pocket money in the past 12 months.
Three-quarters (73%) are giving their children the same amount of pocket money as they were 12 months ago.
|How much pocket money does your child receive per week?|
|New South Wales||$11|
|Source: Finder parenting survey of 1,033 Australian parents of children aged 0–12, November 2022. Figures rounded to the nearest dollar.|
|Are you giving your child more, less or the same amount of pocket money as 12 months ago?|
|The same amount||73%|
|Source: Finder parenting survey of 1,033 Australian parents of children aged 0–12, November 2022|
|Which of the following chores does your child need to do to earn pocket money?|
|Clean their room||40%|
|Clean the dishes/empty the dishwasher||30%|
|Help with laundry/folding clothes||20%|
|Take out the rubbish||19%|
|Take care of the pets (e.g. feed them, take them for a walk)||17%|
|Help with gardening/taking care of plants||15%|
|Clean the kitchen||14%|
|Help with cooking||13%|
|Help with groceries||13%|
|Make their school lunch||10%|
|Clean the bathroom||7%|
|Wash the car||6%|
|Source: Finder parenting survey of 621 Australian parents of children aged 0–12 who responded "yes" to their children having to do chores to earn pocket money, November 2022|
Kickstart your kids savings by setting up a savings account for them now.