These common practices are anything but trivial as they affect the behavior of tomorrow’s banking customers. That is why Orange’s research pays attention to the current practices, rhetoric and experiences of young people to shed light on the future and feed innovation in mobile financial services, in a responsible approach to financial education.
"Orange’s research is based on sociological surveys like this one to support Orange Bank’s diversification by coming up with innovative services to meet the expectations and needs of its customers."
Many adolescents, regardless of social background, regularly receive small amounts of money from relatives, which is often spent in an informal manner. This is usually known as “pocket money.” Unlike other forms of money circulation in families (inheritance, money in couples [1]), these practices have scarcely been documented in sociology, although some marketing studies attest to how often it is given and the sums involved. For example, according to a recent survey [2], 92% of teenagers received pocket money from the age of 11 (i.e. when starting high school). For 42% of them this is a regular gift at an average amount of €30 per month.
11 students and graduate students in sociology conducted a qualitative survey of parents and adolescents to understand the ins and outs of these ordinary practices. They were supervised by Hélène Ducourant, professor at the Paris-Est Marne-la-Vallée University, and the work was carried out in collaboration with Orange Innovation under a School-Business agreement. In the spring of 2021, the researchers conducted 47 interviews with 26 young people (13 girls and 13 boys) aged 10 to 20 and living with their parents, and 21 interviews with their parents (14 mothers and 7 fathers), from a variety of social backgrounds and mainly living in Brittany or the Paris region.
Against all expectations, the research shows that budgeting education, socialization of savings, and the empowerment of children – which are well-established standards that are widely shared by parents – explain only a small portion of effective practices in terms of pocket money. It also evaluates the relative position of cash and money in the bank, and is shaking up perceptions about the arrival of the “cashless society.”
“Money doesn’t grow on trees”: the educational virtues of pocket money
One father who was interviewed used the phrase “freed ants,” which suggests that parents, by giving money, want to help adolescents learn how to limit their own spending.
So, from the parents’ point of view, giving money to “learn money” (an expression borrowed from the sociologist Martine Court [2]) is first and foremost about transmitting values and norms – the value of money, risk avoidance, the taste of effort, and the importance of saving.
Passing on the “value of money” is, paradoxically, about handing over money to make your child accept the idea that money “does not grow on trees,” that it is limited, and about teaching them to prioritize what they want and give up certain things. It also means making them aware of the value of things (usually with cash to back it up) and of the asymmetry between the money we have and our wishes.
Avoiding risks is about introducing a child to managing a small budget that allows them to experience, with limited amounts, trade-offs and waivers, to learn to plan, to “be the ant rather than the grasshopper,” to experience certain pleasures while still being “reasonable in their follies.”
To give the taste of effort is to assert that “pocket money is earned” and to make it, at least partly, an explicit reward for good behavior, whether it be exceptional participation in housework or good school reports.
Valuing savings means opening an account for a child at an early age and regularly topping it up, with a view to large future expenditure emblematic of the transition to adulthood (driver’s license, studies, accommodation, etc.).
From the parents’ perspective, we should remember that the practice of giving pocket money goes beyond the question of initiating kids in financial education. The aim is to support them in their social roles as a child of the family, as a pupil and also as a friend among their peers.
How much, by what means and to do what with? What teenagers do with their money
If you listen to parents, young people must first of all enjoy themselves with their pocket money. For adolescents, what they say is less about the virtues of pocket money and more about the practical details of the amounts received and what they use it for.
What the adolescents interviewed said corroborates the survey results mentioned above, with money starting to be given at around ten years of age, small amounts that increase with age and step up a notch on two occasions – around the time kids start junior high and then senior high school. These sums of money come mainly from parents, but also from grandparents and other relatives for Christmas or birthday gifts. The majority of these are paid in cash or by check for larger amounts.
Outings (to the mall in particular) and sharing meals with friends (fast food, snacks) are the main reason for everyday expenses. Aside from these situations of spending together, but where everyone pays their own way, a significant proportion of pocket money is used to contribute to joint gifts. Beyond the goods and services that are actually consumed, what teens buy with their own pocket money is “freedom under a framework,” social time outside the family unit, away from the beady eyes of parents… but in spaces that have been given the OK by parents and which are basically associated with consuming something and therefore require kids to carry a little money.
Family arrangements around pocket money
How can families be fair about pocket money when there are several children? This issue is of great concern to the parents interviewed. The general rule of treating children equally is a principle that is unanimous, in theory, but in practice is rather difficult to implement, or can sometimes be counterproductive.
Concerned above all with fairness and transparency, parents seem to reserve strict equality for a few largely symbolic occasions (starting junior school, high school, parties, reaching their majority, passing their exams, etc.). Elsewhere, they recount a kind of parenting that evolves over time and is built as an experience tailored by the specific lessons learned from the relationship with each child successively. As a result, the sums will change with their own financial circumstances, and for example, the youngest tend to get more money sooner than their older siblings, benefiting from a kind of group effect.
In any case, there seems to be one principle that overrules everything else – it is important to apply a rule with which everyone eventually agrees. It is a sign that the families surveyed grant importance to discussion, negotiation and consensus.
Does pocket money have a gender?
A significant support for adolescent sociability, pocket money is also a vector for reproducing gender differences. These are imbued not only with educational practices implemented by parents (many studies show that gender is a factor here), but also with stereotypes that are as shared as they are difficult to back up.
As teenagers themselves have said, girls are more likely to use parental bargaining than boys, and to have more diverse consumption needs; they are also more likely to be spenders, whereas boys think they are thrifty.
Parents’ comments go much the same way, and they also have fairly common representations about girls’ “fripperies” and boys’ “lack of autonomy.” Beyond that, and far less explicitly, their budget-management practices point to the pervasiveness of a traditional, highly differentiated model in which the mother manages day-to-day money and is attentive to the financial needs of different family members at the same time.
Money is not neutral – materialized versus digital
These interviews also revealed that for young people and their parents, the uses of money are well segmented according to the pot, the forms of money, whether it is physical (coins and notes) or scriptural (checks, bank transfers, deductions, cards).
Banked money is often considered serious, reserved for savings. Its physical manifestation – the bank card – is a prestigious asset in the eyes of young people. Having one and using it is a way of imitating adults and moving toward financial autonomy. For parents, providing children with a bank account and card is an opportunity to make them accountable while controlling their expenditure and online purchases, and also to control the various options via the banking app. While youngsters get their first phone when they start junior school, a debit card is usually provided when they start senior high. This dematerialized money is also an opportunity to instill basic security rules – do not disclose your PIN, do not lend your card, and so on.
Cash, meanwhile, is more countable. Young people spend small amounts on fun purchases, unlike adults. This money has the advantage of being invisible to parents. Young people are therefore not “accountable to them.” Essentially, parents all agree that the handling of cash is a necessary rite of passage before entering the world of banking.
When they can, young people use both types of money, and it is this ability to use various means of payment that is popular at this age.
Changing practices
At the dawn of a cashless society [4], pocket money is still mostly given in cash, even though more and more families favor the digital option. It is true that young people are making more and more purchases that require the use of digital money (streaming services, e-commerce, delivery services, online video games, etc.). Whether it is with a bank card that has been specifically designed for young people or using cash, it is still essential to make children accountable and to give them financial education on their relationship with money [5]. Over the past two or three years, neo-banks aimed at adolescents have understood this and are on the rise.
Orange’s research is based on sociological surveys like this one to support Orange Bank’s diversification by coming up with innovative services to meet the expectations and needs of its customers.
Find out more
Ducourant H. (ed.), 2021, “Des fourmis libérées”. Les adolescents et leurs parents face à l’argent de poche. Research report by L3 sociology students for Orange Innovation, Paris-Est Marne-la-Vallée University.
Report available by request from beatrice.foucault@orange.com
On financial education:
https://hellofuture.orange.com/fr/leducation-financiere-une-prise-de-conscience-necessaire/
We would like to thank the students who conducted this field study as part of their L3 guided sociology project: Sarah Benhamida, Candice Butty, Darryl Dagba, Sarah Kenniche, Chloé Leal, Antoine Malherbe, Fanny Marouf, Melissa Massonneau, Sandra Peroumal, Oumaïma Sebany and Aminata Coly.
References
[1] De Blic, D. & Lazarus, J. (2021). Sociologie de l’argent. Paris : La Découverte.
[2] Etude « Les ados et l’argent », réalisée par Poll & Roll pour Pixpay en décembre 2020.
[3] Court, M. et al. dans Lahire, B. (dir.) (2019). Enfances de classe. De l’inégalité parmi les enfants, Paris, Seuil.
[4] Danieli, A. (2021). Et si un jour, il n’y avait plus de cash ? Espoirs et points de tensions autour de la cashless society. Blog de la Recherche d’Orange. A paraître.
[5] Foucault, B., Le Huerou, E. & Scherer, A. (2020). L’éducation financière, une prise de conscience nécessaire. Blog de la Recherche d’Orange. https://hellofuture.orange.com/fr/leducation-financiere-une-prise-de-conscience-necessaire/
