Table of Contents
Overview
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- What you need to know
- Products covered in this Report
Executive Summary
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- The market
- Junior cash ISAs grow in volume but stocks and shares fall out of favour
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- Figure 1: Amounts subscribed to Junior ISAs and average subscription per account, 2012/13-2016/17
- Households with two or more children still majority at 55%
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- Figure 2: Percentage of families with dependent children, by number of dependent children in the family, 1997, 2007 and 2017
- The child population is projected to grow
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- Figure 3: Share of total population, by selected age group, 2018-33
- First increase of interest rates in more than a decade while monetary policy schemes come to an end
- Parents are less likely to describe their finances as healthy and less confident about financial prospects
- British children spend an average of £25 a week by the time they reach 15
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- Figure 4: Children’s average weekly spend, by age, 2014/15-2016/17
- Companies and Brands
- Big brands have remained passive in a low-interest environment
- Prepaid cards provide a safe alternative to monitor and control spending
- Savings adspend more than doubles in 2017/18 while investment-related spend falls
- The consumer
- 83% of parents are saving for their children
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- Figure 5: Proportion of parents who are saving for their children aged 10-15, by gender, March 2018
- Banks and building societies are the top choice, but piggybanks still appealing
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- Figure 6: How parents save for their children, March 2018
- Parents still not persuaded to transfer CTFs into Junior ISAs
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- Figure 7: Products held by parents saving for their children, March 2018
- Parents are confident in their actions but reactive about education
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- Figure 8: Parents’ attitudes towards children’s savings, March 2018
- 63% of children say they save money themselves
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- Figure 9: Who children say is saving money for them, March 2018
- Parents could be doing more money-related activities with their children
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- Figure 10: Child and parent saving activities, March 2018
- Children need to be prompted to engage with savings
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- Figure 11: Children’s saving activities, March 2018
- Two thirds of kids say they are in control of their money
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- Figure 12: Children’s attitudes towards saving, March 2018
- What we think
Issues and Insights
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- The time is ripe for a turn in the tide
- The facts
- The implications
- Parents are committed to saving but need support and want flexibility
- The facts
- The implications
- Children’s attention needs to be captured, and early
- The facts
- The implications
The Market – What You Need to Know
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- Junior cash ISAs grow in volume but stocks and shares fall out of favour
- NS&I Children’s Bonds are being phased out
- Child population continues to grow
- First base rate rise in more than a decade
- Parents are less likely to describe their finances as healthy and less confident about financial prospects
Children’s Savings Products
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- Junior cash ISAs grow in volume but stocks and shares fall out of favour
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- Figure 13: Number of Junior ISAs, amounts subscribed and average subscription, 2012/13-2016/17
- NS&I Children’s Bonds are being phased out
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- Figure 14: NS&I transactions with investors in children’s bonds, 2016 and 2017*
- Initiative launched to uncover forgotten CTFs
The Family Environment
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- Composition of households remains stable, but total numbers continue to grow
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- Figure 15: UK households and family types, 1997, 2007, 2012 and 2017
- Most family households have two or more children
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- Figure 16: Percentage of families with dependent children, by number of dependent children in the family, 1997, 2007 and 2017
- The child population is projected to grow
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- Figure 17: Projected size of UK child population, 2018, 2023, 2028 and 2033
- Figure 18: Share of total population, by selected age group, 2018-33
Market Drivers
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- The first rate rise in a decade
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- Figure 19: Average monthly quoted cash deposit and ISA interest rates, January 2011-May 2018
- Funding for Lending and Term Funding Schemes draw to an end
- Parents are less likely to describe their finances as healthy…
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- Figure 20: Current financial situation – parents versus non-parents, April 2018
- …and are less confident about their financial prospects
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- Figure 21: Confidence in financial situation over the coming year, parents versus non-parents, April 2018
- British children spend an average of £25 a week by the time they reach 15
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- Figure 22: Children’s average weekly spend, by age, 2014/15-2016/17
Companies and Brands – What You Need to Know
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- Big brands have remained passive in a low-interest environment
- Best rates tend to come with punishing conditions
- Prepaid as alternative to debit cards and cash meeting demand for pocket money solutions
- Adspend on savings more than doubled in 2017/18
Competitive Strategies
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- Competition has suffered from the low-rate environment
- Halifax launches best-in-town regular saver, but interest is downgraded after a year
- Best rates tend to come with punishing conditions
- Prepaid as alternative to debit cards and cash meeting demand for pocket money solutions
- Digital solutions for pocket money
- RoosterMoney
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- Figure 23: RoosterMoney app
- Money Monster
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- Figure 24: Santander’s Money Monsters
- Pigzbe
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- Figure 25: Pigzbe Kit
Case Study: Shepherds Friendly’s Young Saver Plan
Advertising and Marketing Activity
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- Adspend on savings more than doubled in 2017/18…
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- Figure 26: Total above-the-line, online display and direct mail advertising expenditure on investment and savings products, 2013/14-2017/18
- …but spend on children’s savings and investment products is marginal
- Other selected marketing activity
- Social media and online search
- Sponsorships and partnerships
- Nielsen Ad Intel coverage
The Consumer – What You Need to Know
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- 83% of parents are saving for their children
- Banks and building societies are the top choice, but piggybanks still appealing and online-only providers show high potential
- Parents still not persuaded to transfer CTFs into Junior ISAs
- Parents are confident in their actions but reactive about education
- 63% of children say they save money themselves
- Parents could be doing more money-related activities with their children
- Two thirds of kids say they are in control of their money
Who Saves for Children?
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- 83% of parents are saving for their children
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- Figure 27: Proportion of parents who are saving for their children aged 10-15, March 2018
- Vulnerable consumers under the most pressure
- Dads are more likely to save regularly than mums
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- Figure 28: Proportion of parents who are saving for their children aged 10-15, by gender, March 2018
- Parents of older children are less likely to save on a regular basis
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- Figure 29: Proportion of parents who are saving for their children aged 10-15, by child’s age, March 2018
How Parents Save for Children
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- Piggybanks still appealing…
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- Figure 30: How parents save for their children, March 2018
- …but banks and building societies are the top choice
- Parents likely to consolidate saving methods as children get older
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- Figure 31: Number of ways of saving for children, by age of child, March 2018
Products Used for Children’s Savings
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- Parents still not persuaded to transfer CTFs into Junior ISAs
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- Figure 32: Products held by parents saving for their children, March 2018
- Children’s savings accounts offer an attractive, straightforward alternative
- Transitioning child-specific products into adult accounts could support long-term savings
Parents’ Attitudes towards Children’s Savings
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- More than half of saving parents keep the amount a secret
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- Figure 33: Parents’ attitudes towards children’s savings, March 2018
- Confidence is high that parents are making the right choices
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- Figure 34: Agreement with the statement “I feel confident that I am saving/investing for my child in the best possible way”, by current financial situation, March 2018
- Most parents use paid chores to teach kids about money
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- Figure 35: Agreement with the statement “I offer my child the chance to earn money by helping me with tasks (eg household chores)”, by child and parent gender, March 2018
- Three in five will only talk to their child about savings when they show an interest…
- …while 71% only allow approved purchases
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- Figure 36: RoosterMoney’s Savings Goals Feature
Who Children Say Saves for Them
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- 63% of children say they save money themselves
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- Figure 37: Who children say is saving money for them, March 2018
- Children of older parents more likely to say their parents are saving for them
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- Figure 38: Who children say is saving money for them, by age of parent, March 2018
- The Bank of Gran and Grandad?
Children’s Saving Activities
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- Parents could be doing more money-related activities with their children
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- Figure 39: Child and parent saving activities, March 2018
- Learning about money, the fun way
- Children may need some nudging to get them more involved in saving money
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- Figure 40: Children’s saving activities, March 2018
- Gender stereotypes reflected in children’s savings goals
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- Figure 41: Children’s savings goals, by gender, March 2018
Children’s Attitudes towards Saving
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- Two thirds of kids say they are in control of their money
- Children want to talk about money and need someone to listen
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- Figure 42: Children’s attitudes towards saving, March 2018
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
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