Teens admit to being ‘carefree' with their cash
Equifax research reveals financial savviness of UK teenagers
Personal finance was put on the national curriculum in 2014, but are today's teenagers putting what they are learning in the classroom into practice? New data* from Equifax, the credit information provider, reveals that when it comes to spending habits, 35% of teens say that they are ‘carefree' or not very careful. This increases to 45% for 17 year-olds, which is a concern given they are on the brink of being able to access credit.
According to the newly released Equifax data, 40% of 13 to 18 year-olds have a debit card. And while a quarter never spend the whole available balance on their debit card, 15% admitted to reaching the limit at least once a week. 16% reach their limit on a monthly basis.
Among 13 to 18 year-olds, 5% make online purchases once a week, with a further 15% shopping online once a month. This increases to 29% of 17 year-olds making at least one purchase a month. A significant proportion (60%) have a contract mobile phone.
When it comes to funding their spending, the majority of 13 to 18 year-olds said they have an allowance. Just over a third (34%) do chores around the house and 25% of teens have a part-time job to earn money.
According to research from the Financial Services Compensation Scheme** (FSCS) millions of young children have no experience with money. With 45% of 17 year olds admitting to carefree spending habits, who is influencing their attitude to finances? According to the Equifax research, it seems that teens are more influenced by their mums than their dads. Over half (55%) of 13-18 year olds said they have adopted their mum's spending habits.
"It's important to have the right foundations from an early age to ensure that young people continue to manage their money well throughout their life", said Lisa Hardstaff, consumer credit information expert at Equifax. "Having a debit card and managing a monthly budget equips teenagers with the responsibility of managing their own finances. However, it's vital that young people have access to education that equips them with the skills and understanding they need in order to stay in control of their finances and have a positive experience with money as they grow older.
"Organisations like Young Enterprise play an important role in helping young people understand how to manage their money, offering additional advice and support alongside school and parents. This is particularly important for young people as they turn 18, as this is when they will be able to apply for credit cards or loans. They will need to understand that it will be their responsibility to pay it back."
* Research conducted by Censuswide. 500 parents aged 13-18 and 500 children aged 13-18
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