In the age of tapping and clicking, cash is becoming part of a bygone era as children are becoming more familiar and comfortable with digital payments. A new survey from TD reveals that nearly seven in 10 (68 per cent) parents say their children are more or just as comfortable using digital payments as handling cash, with their comfort levels increasing as they get older (50 per cent for children ages 4-7 years old and 81 per cent comfort level for children ages 15-17 years old).
“Kids are becoming more and more digitally savvy. Whether it’s accessing an in-app game for a tablet or downloading music from a sharing site online, children are starting at a younger age to understand the concept of making digital purchases by witnessing their parents’ payment habits – often without realizing what it all means,” said Rina DeGrazia, Vice President, Financial Education at TD. “As the payment environment continues to change, it is important to evolve the conversation of how we talk about money to help kids understand the landscape and help ensure they feel financially confident to make smart money decisions throughout life.”
In fact, without these important conversations, Canadian parents are concerned there can be negative impacts for their children, including: not appreciating the value of money (32 per cent), being prone to impulse purchases (29 per cent) and not learning the importance of saving (29 per cent). And when it comes to education, the survey showed that over nine in 10 (91 per cent) Canadian parents feel it is their responsibility to teach their children to use digital payments responsibly.
The survey also found that more than half of Canadian kids have borrowed from mom or dad and have spent more than what they were allowed or expected to spend. What are kids spending this money on? According to the survey, the top categories include: food (63 per cent), in-store shopping (60 per cent), online shopping (46 per cent), and entertainment such as music, movies, and gaming (33 per cent).
“Just as they have for decades, kids continue to ask their parents for money. But what’s different is that today parents may find they aren’t keeping that much cash in their wallets,” continues DeGrazia. “Regardless of how your kids pay to shop at the mall or for online and in-app purchases, it’s more important than ever to help your children keep track of how much they’re spending and to have ongoing conversations about how to manage their money responsibly.”