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The experiences and attitudes of children from low-income families towards money

Jules Shropshire and Sue Middleton

28 March 1999

Little is known about how children come to terms with poverty or how they learn about the economic world around them. Using data from interviews with children aged between 5 and 16 years, this report describes how they make sense of the wider economic world, how they act in the knowledge that their family is poor and how low income influences their view of their own economic futures. From children�s own perspectives, it explores how far they are able to learn about money management, what they learn about their family�s economic position within society and the effect this has on children�s beliefs, behaviour and aspirations.

Summary

March 1999 - Ref 379
The experiences and attitudes of children from low-income families towards money

Over one-third of British children are living in poverty. Yet little is known about the effect this has on their understanding of the economic world, their behaviour and beliefs, or their aspirations. This study describes the immediate effects of growing up in poor families drawing on evidence from the 'Small Fortunes' Survey of the lifestyles and living standards of children, undertaken by the Centre for Research in Social Policy at Loughborough University in 1995. The study shows that:

  • Children living in lone-parent families and families claiming Income Support had less experience of handling their own money than did other children: they were less likely to receive regular pocket money and were less likely to have part-time jobs.
  • Of the two-fifths of children who did have part-time jobs, those living in lone-parent and Income Support families worked for longer hours and for lower rates of pay than did other children.
  • Most children were never told about family income or spending; when they were, parents were more likely to discuss spending than income.
  • Family discussions of income and spending were more likely to occur in lone-parent families than two-parent families. Discussions of family income were also more likely in families claiming Income Support than in other families.
  • Two-thirds of children in lone-parent or Income Support families said they were frequently told their family could not afford what they wanted; less than half of other children said this.
  • The immediate effects of growing up in poverty were apparent in the children's beliefs, behaviour and aspirations:
    -     two-fifths of children living in Income Support and lone-parent families worried that their family did not have enough money to live on, compared with less than 10 per cent of other children;
    -     many children who lived in lone-parent families learned at a young age not to ask for things they wanted;
    -     career aspirations were much lower among youngsters living in Income Support and lone-parent families compared with children from non-Income Support or two-parent families.

Background
Despite the growth in the number of British children said to be living in poverty over the last 20 years, little is known about how children come to terms with poverty and the effects of poverty on their beliefs, behaviour and aspirations. More generally, we have only limited knowledge about how children learn about the economic world around them. Yet children's knowledge and experience of both the economic circumstances of their immediate family and of the wider economic world outside the family are likely to affect their own economic futures. The central question which the research seeks to answer is, do children learn to be poor?

Children's experience of handling their own money
Children of lone parents (16 per cent) and of parents on Income Support (21 per cent) were more likely to receive pocket money infrequently and only when their parents' budget allowed than were children living in two-parent (eight per cent) or non-Income Support families (seven per cent).

Experience of part-time work was less likely for children (over 11 years old) of lone parents or from families on Income Support than for other children (see Figure 1). Approximately one-quarter (28 per cent) of children of lone parents were involved in paid work compared with two-fifths (41 per cent) of children in two-parent families. One-third of children from families claiming Income Support (32 per cent) had a part-time job compared with two-fifths of children in families not claiming Income Support (40 per cent).

Whilst less likely to have a part-time job, children from lone-parent or Income Support families who did work did so for longer hours and for lower rates of pay than other children. One-third of children in Income Support families and one-quarter of children in lone-parent families did more than seven hours paid work per week compared with just one-fifth of children in either non-Income Support or two-parent families. Children in lone-parent families earned on average 65p less per hour than children in two-parent families (£1.65 and £2.30 respectively). Children living in Income Support families earned an average of 45p less per hour than children in non-Income Support families (£1.82 and £2.27 respectively).

Learning from parents
Children living in lone-parent and Income Support families were more likely to learn about their family's economic circumstances from their parents than were other children.

More lone parents than two-parent families discussed with their children, family income (31 per cent and 13 per cent respectively) and spending (45 per cent and 33 per cent respectively). It is possible that lone parents are sharing their anxieties and concerns about money with their children in the absence of another adult with whom to discuss such matters. Discussions of family income were also more likely in families claiming Income Support (24 per cent) than in other families (15 per cent).

Children living in lone-parent families and those claiming Income Support were more likely to be reminded that their families could not afford things children wanted. Two-thirds of children in lone-parent and Income Support families said they frequently had their requests turned down because their family could not afford what they wanted compared with less than half of all children from two-parent or non-Income Support families.

Beliefs, behaviour and aspirations
A significant number of children living in lone-parent and Income Support families were worried that their family did not have enough money to live on (see Figure 2). Children in families on Income Support (42 per cent) were at least five times more likely to think that their family income was inadequate than other children (eight per cent). Similarly, children in lone-parent families (39 per cent) were over four times more likely to say that their family income was too low than were children in two-parent families (nine per cent).

To examine children's immediate expectations they were asked what they would ask for if it were their birthday next week. On the whole, children identified the same types of items and services, however, the estimated cost of the items named by children living in lone-parent and Income Support families was significantly lower than the cost of items named by other children. Regardless of the cost of the desired item, a significant number of children from lone-parent and Income Support families had learnt to accept that they might not get what they wanted for their birthday and to cover up their disappointment.

To establish children's future aspirations they were asked what they would like to do when they left school. Children in lone-parent or Income Support families had much lower career aspirations than children from either two-parent or non-Income Support families. Children from lone-parent or Income Support families were more likely than other youngsters to want jobs which typically take a minimal amount of time to train for and, on the whole, require few, if any, academic qualifications. Moreover, fewer children from lone-parent (21 per cent) or Income Support families (17 per cent) than children in two-parent (31 per cent) or non-Income Support families (32 per cent) aspired to join the labour market in the professional occupations defined as socio-economic group four.

Conclusion
The researchers conclude that as children learn about their family's financial situation, they are likely to form views about their family's economic position in relation to the rest of society. Children from lone-parent families, those who believe their family does not have enough money and those who are frequently denied items learn at a young age to curb their requests for items that they would like to own. Children living in lone-parent or Income Support families also have fewer opportunities to learn how to manage a regular sum of money than other children as they are less likely to receive pocket money or earn money from paid work. It is possible that, for some children, early learning of this sort reduces both their immediate expectations and future aspirations and that they are 'learning to be poor'.

About the study
Fieldwork for the 'Small Fortunes' Survey took place between February and June 1995. The survey was based on a random sample of individual children stratified by children's age, birth order and family type (whether children were living in one- or two-parent families). The dataset (now lodged with the ESRC Data Archive at the University of Essex) contains information about 1,239 children. This report is based on responses to an interviewer-administered questionnaire completed by 435 children aged between five and 16 years (27 per cent from Income Support families, 43 per cent from lone-parent families, with 22 per cent from lone-parent families on Income Support).

How to get further information
The full report, Small expectations: Learning to be poor? by Jules Shropshire and Sue Middleton, is published for the Foundation by YPS. (ISBN 1 902633 27 X, price £10.95 plus £2 postage).

Further details of this survey can be obtained from the authors (Jules Shropshire and Sue Middleton) at CRSP, Loughborough University, Loughborough, Leicestershire, LE11 3TU.

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