Despite a reduction in the proportion of kids receiving a regular allowance (from 65 per cent in 2021/22 to 57 per cent in 2022/23), British kids’ average annual income increased by 11 per cent in 2022/23, working out at £6.42 per week; NatWest has revealed.
The cost of living crisis has forced the majority of people in the UK to rethink their spending habits and keep an eye on bank balances. As a result, NatWest Rooster Money has revealed that fewer kids are receiving pocket money at regular intervals. Instead, parents have opted for larger one-off payments (which accounted for 39 per cent of earnings in 2022/23 – up from 34 per cent in 2021/22), using moments like special occasions and good behaviour as opportunities for extra generosity.
The findings come from NatWest’s latest Rooster Money Pocket Money Index, an annual study of over 125,000 children, analysing the UK youth economy and looking to reveal the trends shaping young people’s finances.
While many would expect pocket money to rise with age, in 2022/23 it was 16-year-olds who enjoyed the highest weekly pay cheque, at £12.75. 17-year-olds took home a slightly lower £12.59 potentially due to the introduction of increasing financial independence. It actually was six-year-olds who saw the biggest pay rise overall, seeing 34 per cent year-on-year growth to reach £3.94 a week.
Entrepreneurial kids, meanwhile, appear to have turned more to side hustles to maintain a steady stream of income – with those who do raising an average of £50.84 each outside of chores (16 per cent more than they did in 2021/22). Average earnings for babysitting rose 24 per cent to £20.55, revenues from reselling possessions like clothes crept up six per cent to £26.26, and tutoring benefitted from a huge premium, with earnings per job soaring 102 per cent to £16.95.
Looking to the future
NatWest also revealed trends that may point to the future of spending for the next generation. Brands with a physical presence dominated the most popular places to spend money in 2022/23. The likes of Co-op, Tesco, McDonald’s and Sainsbury’s occupied spots in the top five, while digital brands like Amazon, PlayStation and Xbox fell down the rankings when compared to past years.
Public transport also rose to number seven, suggesting that people are getting out and about again after the covid pandemic.
Will Carmichael, CEO and founder of NatWest Rooster Money, said: “Faced with less regular pocket money, kids have been really entrepreneurial and proactive this year. This is true in its purest sense with the soaring proceeds from side hustles, but also in the business-minded approach they’re taking to earning around the house – managing to monetise not just chores but things like learning and personal development. I certainly wasn’t paid for doing my homework as a child!
“Every year I’m inspired to see the creativity and ambition of these young people and how engaged families are with pocket money and earning despite times being tough, which can only be a positive sign for the future.”