Recession bites into sweetie budget as pocket money hits a 7-year low

The amount of pocket money children receive has fallen to a seven-year low, a survey indicated today.

The average child receives 5.89 a week, the lowest level since 2003, and down from 6.24 in 2009, according to new figures.

And the total - published by bank Halifax - is nearly 2.50 lower than the 8.37 children aged between eight and 15 received each week when pocket money levels peaked in 2005.

Youngsters are also saving far less, with nearly a third saying they make no attempt to save any part of their pocket money.

Financial advisers said schools needed to focus more on teaching young people the value of saving, and parents were not the best role models for budgeting.

The Halifax survey found boys still receive more money than girls, but the gender gap in spending money has closed considerably compared with previous years.

Boys get an average of 38p more than girls each week, far below the 1.30 gap last year.

Older children receive more than younger ones, with those aged between 12 and 15 getting about 7.02 a week, while those aged between eight and 11 get 4.57.

Although pocket money has fallen during the past year, half of children think they get the right amount, although 42 per cent think they should get more.

Flavia Palacios Umana, head of savings products at Halifax, said: "It is encouraging to see that children are still saving, despite the amount of pocket money falling.

"Developing the habit of saving a little and often will stand them in good stead in later life."

Only 23 per cent of children save at least half of their pocket money each week, down from 49 per cent last year, while 9 per cent save all of their money. But 29 per cent of children admit they do not save any of it.

Yvonne Goodwin, an independent financial adviser, said young people needed to learn about budgeting for spending, saving and charity.

She said: "Parents are probably not good role models because they didn't get the lessons they needed. None of the banks are interested in making people enthusiastic about saving again. I don't think the banks could make enough money out of it, but that's what we need."

Scottish children have previously been the second best paid in the UK, receiving an average of 426.40 in a year in 2008. By comparison, they were worst for saving that money.

Around 35 per cent of children said they would save up if they wanted to buy something expensive, but 39 per cent said they would ask for it for their birthday or Christmas and 18 per cent would resort to pestering their parents until they bought it. Children in Wales receive the most pocket money, at an average of 7.77, knocking London off the top spot, with children there now getting an average of 6.89.Children in the South-west and East Anglia receive the least - 5.05 and 5.23 respectively.

A spokeswoman for Halifax said they did not do a regional breakdown for Scotland this year and do not release their full research reports. TNS questioned 1,204 children aged between eight and 15 between August 26 and September 2