The piggy bank is a classic in many households for storing the pocket money that minors usually receive every week from their parents. In the Netherlands they are still one of the first gifts given to children, but things are changing. Between the ages of eight and nine, 28% receive their wages through a bank account opened in their name. Five years ago it was 15% and the transfer is done digitally. From this age onwards, the little pig loses its lovable presence in the children’s room, but the little ones learn to handle their capital better. They can know what they earn and how much they spend without breaking the bank. The problem with this change in savings behavior is the security of secret codes in inexperienced hands.
The data was published in October by the National Institute for Household Information (Nibud, in its Dutch acronym), which studied how parents teach their children – aged 6 to 14 – about money management. The survey supporting the work was carried out between April and May last year in collaboration with Rabobank bank. Of the 1,468 parents surveyed, 87% believe teaching good money management is an important part of their job. On the other hand, 93% pay regularly, and the amount has increased since 2018. While seven-year-olds receive between 1.40 and 2.30 euros per week (five years ago the maximum amount was 2 euros), 11-year-olds receive between 2.30 and 3.50 euros (previously a maximum of 2.30 euros). “The study shows that minors with pocket money are more concerned about financial matters and develop more skills in this area than those who do not have this type of loose money,” Nibud said.
The danger of this new habit is that minors may not be careful with their bank cards and secret access numbers. In 2018, 72% of parents were confident that their children did not give other people access to the PIN code. Now only 57% believe it. However, only 21% of parents emphasize to their children that they should be particularly careful with this data. And only 22% alert them that they could be the target of fraudulent requests for money that may not be detected in time. Some unsolicited offers may even lead to fraudulent transactions via underage accounts. In return, they receive an amount without realizing that this is a form of cybercrime that could turn them into so-called “money mules”. At this point, Nibud emphasizes how important it is to “inform children about such dangers as early as possible, because now only one in five parents does this.”
How to ride a bike
The phenomenon of childhood bank accounts is not new in the Netherlands. While previously it was opened at secondary school age, in 2017 the trend was already visible from primary school onwards. “Parents have less and less cash at home and weekly payments digitally are very convenient,” Gabriëlla Bettonville from Nibud herself told Dutch public television (NOS). However, bank card holders may be too young to do math or understand receipts well. Nibud itself – an independent organization – recommended that minors be taught how to use and maintain a card from basic education onwards. They compared it to riding a bicycle, a gradual learning process that only throws the cyclist onto the road once he or she maintains balance.
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