Digital Pocket Money Trend: Young People Benefit From Switch To Payment Requests

From snacks and fast food to online games and clothing: young people increasingly ask their parents for money for small expenses. Research by the online sofa BUUT shows that more than half of parents (54%) transfer extra money on top of their regular pocket money every month, usually one to three times a month.

Nearly a third of parents automatically pay these payment requests without asking exactly what the money is intended for. This creates a new, digital form of pocket money: less visible, unknowingly higher than expected, and sometimes even double the originally agreed-upon amount. According to BUUT, a new online bank from ABN AMRO, this leads to both parents and young people becoming "financially skewed."

Financial Behavior of Young People and Their Parents

BUUT has studied how young people aged 10-16 and their parents handle money. The results are relatable but also confronting. In a world where money is increasingly digital, the need for a new form of financial education is growing, not only among parents but also among young people themselves.

Young people often impulsively choose a snack at the cafeteria, while they're actually saving for a larger purchase, like a PlayStation. This impulsive spending leaves them with little control over their income and expenses.

Teenagers' Expenses

The research shows that teens spend the most money on snacks (62%), school supplies (34%), gifts (29%), and clothing (26%). Many parents recognize the regular payment requests for things like a McDonald's meal, a new sweater, or "emergency money for the last week of the month."

Although parents typically provide a fixed amount of pocket money, young people regularly send payment requests to supplement that amount. A quarter of parents now consider these payment requests an extension of their pocket money, but only 10% adjust their monthly pocket money accordingly.

The Importance of Financial Education

Despite 92% of parents teaching their children to be mindful of money, more than half (54%) admit they still give extra money through payment requests. It's therefore important that parents keep the conversation about money going, even if they're inclined to help their child when things get tough financially.