Many parents let their children make online purchases, but some of that shopping goes unsupervised. Almost one-third of parents say their children have made digital purchases without their permission, according to a Talker Research survey.
While some of the purchases were for video games and fashion, bigger ticket items like computers and smartphones were also online purchases that some children made without their parents knowing.
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Spending Sprees Amounts Varied Greatly
When children make purchases without their parents' permission, the average cost comes to $170 per purchase, according to the survey, which accounts for children who are 18 years and under. However, 19% of parents reported their child's spending spree exceeding $300.
These incidents have become more common because many parents aren't keeping a watchful eye over their children's spending. The survey found that 23% of parents rarely or never check their children's debit and credit card activity. An additional 11% of parents don't even require their children to obtain permission before making online purchases.
It's easier than ever for children to make purchases, and with many parents busy due to full-time jobs and other commitments, it's harder for them to stay on top of their children. The end result is a growing trend of unauthorized purchases.
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Children Don't Understand The Value Of A Dollar
Children understand arithmetic. A $100 bill lets you buy up to $100 in goods. However, 72% of the parents surveyed believe that their children do not fully understand the value of a dollar.
Digital purchases don't help with this, since children don't see the money physically leaving a wallet. Almost half of the parents included in the survey said that it is harder to teach kids about the value of digital money versus physical money.
Parents need to teach their children financial awareness and the value of investing. These lessons aren't taught in school, making it the parents' responsibility. It's better to teach your children about money early, as it can give them a competitive advantage when they get older.
How Parents Address Unauthorized Purchases
Many of the same parents who reported that their children make purchases without their permission also said that they address those incidents. More than half of the parents polled addressed it by having a conversation with their children. While a conversation is standard, there are other ways parents respond to the situation.
More than 20% of parents take away a device and require that the child pay back the money. Meanwhile, 11% of parents say that they freeze or restrict a child's bank account access, according to the survey.
Approximately two-thirds of parents wish their children were learning about financial responsibility, but don't believe they have the skillset. More than 60% of parents wished that a financial expert could guide their children, but the responsibility ultimately falls on the parents.
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