Investor Education Centre Survey Reveals Hong Kong Family’s Concept of Money
Majority of the parents (87%) consider themselves a good financial role model for their children
Yet only 44% think their children are good at money management
14 August 2018
- Gap between parents’ expectation of their children’s understanding of money and the reality
- Vast majority of parents (89%) surveyed agree that it is important to learn about money but less than half (49%) of the child respondents think so
- Around six in ten parents surveyed are concerned that their children lack the discipline to save and do not realise that money comes from hard work
A recent survey conducted by the Investor Education Centre (IEC) shows that parents can pay more attention to their children’s understanding of money matters and help them develop good financial habits and skills. Contrary to parents’ belief, children are much less aware of the amount of money they have, where money comes from and the cost of daily living expenses.
In June 2018, the IEC conducted a Parents and Kids Financial Capability Survey across a total of 800 respondents, comprising of 400 Hong Kong parents and 400 primary school age children. The survey was intended to learn how parents teach their children about money and the children’s grasp of money concepts and financial habits.
Survey results revealed that parents tend to overestimate their children’s understanding of the source of family income and household expenditures: 84% of parents think that their children know what they do for a living, compared with 67% of children who said they know what their parents do. Just 14% are aware of the cost of running a household, and only 38% understand the cost of their education and extracurricular activities.
More money talks
Of the parents surveyed 87% considered themselves a good financial role model for their children. Top reasons cited include exhibiting discipline when shopping and refraining from unnecessary spending (80%), having a habit of saving (72%) and shopping around to compare prices (56%).
When it came to having money talks and imparting financial life skills, less than half of the parents surveyed have set aside time to talk about money matters with their children (45%) and have shown them the household bills (47%). Many parents (73%) say that their children have their own bank account, and 71% think that their children are aware of the amount in the account. However, only 22% of children know that they have their own bank account.
"Most parents recognise that they play an important role when it comes to imparting financial knowledge and cultivating good financial habits in their children," said Mr David Kneebone, General Manager of the IEC.
"We encourage parents to make use of everyday situations to help their children learn practical money skills, such as how to make smart purchases when shopping, reviewing household bills and planning and budgeting for family outings. Parents can not only give their children a sense of responsibility, but provide a foundation that will positively impact their financial well-being in adulthood." Mr Kneebone added.
Financial habits of Hong Kong children
When the findings were compared with the Hong Kong Financial Competency Framework, which provides guidance on the financial competencies that children should ideally possess, the survey also revealed some encouraging signs that Hong Kong children are displaying good habits and making smart decisions.
Most of the P1 to P3 students surveyed are in the habit of saving, with over 80% saving part of their pocket money. Another 69% demonstrated understanding of the concept of delayed gratification and would save their money to make future purchases.
Older primary school children also demonstrated good money management traits. When buying something, 86% of P4 to P6 students surveyed said they would shop around and 73% set themselves money saving goals. However, only 31% track their spending.
"It is heartening to know that Hong Kong children generally show good money management behaviours. Parents can help them develop these skills further by praising their good behaviour, explaining the merits of their actions and pinpointing areas for improvement," said Mr Kneebone.
An easy way to start money conversations with children is to casually cover key money concepts in a relaxed and conducive environment. Children will be more open to absorbing knowledge through games, role play and fun activities.
IEC’s consumer education platform, The Chin Family, will launch Good Old Times, a free role play and learning activity for children aged 4 to 12 years old. Taking place at Fortune Metropolis at Hung Hom from 15 to 21 August 2018, participants will be assigned tasks to learn basic money concepts and experience the traditional culture of old Hong Kong. Practical and fun teaching tools will be available for free to parents to take home for use with their children.