"The relationship with parents, kids and money is pretty complicated," said Stuart Ritter, a certified financial planner with T. Rowe Price. "One of the things we learned from parents is they'll borrow money from their kids to tip the babysitter. Hopefully they're putting it back. And they're bribing their kids. They're using the money as a reward."
Nearly half of the 1,000 parents surveyed in the new T. Rowe Price report admit they bribe their kids with money to encourage them to do the right thing. And when parents run out of cash, almost one-third admitted they sometimes "borrow" money from their childrens' piggy banks.
The piggy bank may not hold the same cachet for kids today that it did when their parents were growing up. Most of the financial transactions they see made are on a mobile phone or laptop. Of the 924 kids ages 8 to 14 who participated in the survey, 54 percent said they use and make purchases on mobile apps and 61 percent shop online. Even a third of parents said cash has become "obsolete."