From pocket money to portfolios: How Aussie parents are rethinking financial support

In an era where tap-and-go is second nature and crypto is creeping into kids’ vocabularies, Australian families are reimagining how they support their children financially. The latest insights from ING show a shift from coins for chores to long-term wealth strategies.

Pocket Money Gets a Digital Makeover

While 78% of Aussie adults received pocket money growing up, only 38% of today’s parents are continuing the tradition. But when they do, it’s not just about spare change – it’s about instilling financial habits. The average weekly amount has risen from $11.05 to $16.55, and over 80% of kids still earn it through chores like dishes, vacuuming, and pet care.

Average pocket money received through the generations

Average amount parents currently pay their kids

21% say they’ll pay their children pocket money until they turn 18, with another 13% who will continue once they’re adults.

Investing in the Next Generation

A standout trend: 37% of parents now invest on behalf of their children, averaging $2,212 annually. Millennial parents (56%) and high-income households (53%) are leading the charge, favouring ETFs, shares, and savings accounts. Most kids gain access to these funds around age 20, though Boomer parents tend to wait until their children are 22+.

This shift reflects a broader move from short-term spending to long-term financial planning, mirroring the digital-first, low-interest-rate environment many parents have navigated themselves.

The Bank of Mum & Dad: Still Open

Support doesn’t stop at 18. Over half (53%) of parents with adult children continue to provide financial assistance, spending an average of $1,635 per month. Gen X parents are the most generous (76%), while Boomers are more likely to encourage independence. Interestingly, 60% of parents reduce support once their child turns 18, signalling a desire for greater financial autonomy, but despite this – almost a third (28%) said financial support stayed the same.

Talking About Money Matters

Despite ongoing support, 75% of Australians believe adult children should contribute to household expenses from age 18. This belief is strongest among those who received pocket money and were expected to contribute themselves.

These findings underscore the importance of financial conversations at home. Whether it’s pocket money or portfolios, how parents talk about money shapes how kids think about it.

Matt’s Tips for Raising Money-Smart Kids

1. Start Early: Use pocket money and chores to introduce basic concepts.
2. Make It Tangible: Use real-life examples like grocery shopping or bills.
3. Talk About Investing: Explain shares, ETFs, and compound interest.
4. Encourage Earning: Link money to effort – chores or part-time work.
5. Be Transparent: Share your own budgeting and saving decisions.
6. Celebrate Milestones: Acknowledge savings goals and smart choices.

As the data shows, Aussie parents are evolving from pocket money providers to financial mentors. And that’s a good thing – because the earlier we teach kids about money, the better prepared they’ll be to thrive in a fast-changing financial world.

Matt Bowen is ING’s Head of Consumer & Market Insights. He appears daily on Ch7 Sunrise program with commentary on the top money stories for Australians. For interviews or media enquiries, or interview requests, please contact Cassandra Geselle.