Children are more clued up on their finances than parents give them credit for, according to new research by the Post Office.
When asked what they would do with their savings when they reached 18, 52% of children polled said they would save it. The second most common answer was to put it towards their education.
The study of 704 parents with children under 18 and 501 children aged between 8 and 18 also found that awareness of the new Junior ISA (JISA) was higher with teenagers than with parents themselves. A tenth of children under 10 thought the JISA was a new type of phone.
Of the parents polled, only 25% planned to invest money into a JISA for their children but a whopping 42% admitted they didn’t know what one was. Of those who weren’t planning to invest in savings, 49% said they wouldn’t trust their kids to spend it wisely, compared to 71% of those who were planning to save.
“Our research shows education and savings are top of mind for most children should they receive a lump sum of cash at 18 years old,” said Richard Norman, director of savings and investments at Post Office. “The news is full of stories about the economy and this hasn’t escaped the attention of the younger generation. Raising financial awareness in a recessionary environment will hopefully ensure the younger generation grow to be financially savvy adults.”
Parents also underestimated their children’s generosity, with only 1% of parents predicted their kids would give money to charity or friends and family. Actually 10% of the kids said they would do this.