The team behind Policygenius, an online insurance marketplace, just released data from a recent survey about how parents talk to their kids about money. Approximately 1,500 parents of children under the age of 18 were surveyed across the United States over a three-day period earlier this month. The results: parents are talking to their kids about big financial factors — like budgeting, debt and credit scores and the like — while offering special insight into how dads handle money matters.
According to respondents, nearly half of all dads surveyed said they give their kids an allowance. The amounts dolled out each week varied — 13.2 percent of fathers admit to giving their kids less than $10 a week, while 9.1 percent say they pay upwards of $50 a week — but approximately one in every two dads say they consistently pay their kids allowance each week.
Experts say paying children allowance is important for teaching the significance of money. Peter Lzaroff, author of Making Money Simple, told Policygenius paying kids an allowance not only helps instill good money habits, but “creates natural opportunities for meaningful money-related conversations.”
Providing a weekly allowance and discussing financial concepts like budgeting and saving, seem to go hand-in-hand. According to Policygenius, 49 percent of the parents who don’t offer their kids an allowance haven’t begun to talk about financial concepts with them either.
Having money-related conversations with children when they’re younger can help develop financial literacy, yet only 38 percent of fathers are talking to their kids about budgeting.
Paying children an allowance is an easy segue into talking about larger concepts like budgeting. Some opportunities to do just that — help kids set aside a portion of their allowance for things they consider meaningful, like contributing to their own soccer lessons or paying towards an afternoon ice cream splurge.
Talking about allowances and budgets are major first steps, and it seems like a lot of dads are taking them, but only 27 percent of fathers surveyed have opened a savings account for their child.
While some of the information Policygenius uncovered was surprising — like the fact that 13 percent of respondents (not just dads) admitted to paying their children $100 or more a week in allowance — the results were clear that many dads are discussing basic financial concepts with their kids.
Overall, 63 percent of parents surveyed said that they talk to their children about financial matters. You can review the full breakdown of the results from Policygenius’ survey on their website.