Cash is slowly becoming a thing of the past. The move towards becoming a cashless society has undoubtedly been accelerated by the Covid-19 pandemic. In recent months, we have been actively encouraged to use card payments, the contactless limit has been increased and when shops were shut, we headed online.
But what does this mean for our children? Are the days of adding weekly pocket money to a piggy bank gone? And are children adapting to this new cashless society?
Research from pocket money app RoosterMoney suggests that kids in the UK are already ahead of the curve.
Are children ready for a cashless society?
For many of us grown ups, the idea of pocket money is a physical thing. Not only were we physically given cash by our parents, we would also buy something physical in a shop.
But for children growing up today, it is a very different picture. As the CEO of RoosterMoney, Will Carmichael, puts it, “with the last few months accelerating our move to becoming a cashless society, we can see that reflected not only in our own savings habits, but also in those of our children too”.
I personally haven’t used cash for months. I very rarely have any in my purse. But that is purely because I don’t need it for the transactions I am making.
Food shops are either done online or via my debit card. Clothes and other items are bought using Apple Pay or PayPal through my phone. So it’s not surprising that my children don’t handle cash much either.
And that is the point that RoosterMoney’s survey of 24,000 kids in the UK is making. Children are already moving into a cashless society because their parents are. And the lockdown measures that made us stay at home encouraged this shift towards purchasing digital items over physical ones.
According to the research, spend on online games such as Roblox and Fortnite increased significantly during the second quarter of 2020. Traditional physical pocket money items such as books, magazines and sweets were pushed down the leaderboard.
Are we prepared for our children to go cashless?
It’s all very well children adopting a cashless approach. But are there products out there that parents can use to facilitate this?
The answer is yes. And don’t worry, there is something for all age ranges.
As most current accounts in the UK require a child to be at least 16 years old, this means that most children don’t have access to a debit card. Instead, there are a range of prepaid cards available, with some specifically designed for children.
For example, the gohenry prepaid card provides children with a cashless option – but helps parents to stay in control. Features such as real-time spend notifications, automatic weekly money transfers and a parental control centre all enable children to learn how to spend and save. And the card is available to children as young as six.
Alternatively, pocket money apps such as Rooster Money help children between four and 14 learn about how to use money, but in a cashless way. For younger children Rooster Money provides a Star reward system instead of money. For older children there is a prepaid card option, and the ability to set up regular payments for things such as magazine subscriptions.
The march towards a fully cashless society is only going to continue. It was a trend that was already growing, and the pandemic has accelerated the speed of change. However, education about personal finance is vital in order to not leave the most vulnerable areas of society behind.
The younger we start to teach children about money, the more likely it is they will be able to manage their personal finances when they are older. And as we move towards a cashless society, it may mean finding those cashless age-appropriate options that will help our children be in control of their own money.
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