Recession has minor impact on Finnish teens’ finances

12.11.2009In Finland the economic recession has to some extent affected teens’ consumption habits, but the consumption structure remains the same. Nor has the amount of money available for teens changed over the past two years. Some young people have nevertheless had to dip into their savings to cover their expenses, Nordea’s survey indicates.

Six out of ten teenagers receive regular pocket money from their parents and most of them also get some extra money when necessary. On average, parents give their teens 44 euro in regular pocket money every month. Including extra money from their parents and relatives as well as money earned from working, they have 50 euro on average at their disposal every month. The amount of pocket money increases with age. The differences between the various income groups have apparently levelled off since 2007 when teens from high-income families clearly received more regular pocket money than other income groups. This year this difference is no longer evident. In 2007 teens’ pocket money averaged 40 euro a month.

Teenagers have reduced their consumption a bit during the recession, but the structure remains the same – most teens spend money on snacks, soft drinks, sweets and chips. The second-most popular spending target is pastime pleasures such as movies, concerts and going to cafés or restaurants with friends.

Saving is popular

Nearly 90% of young people save money, at least every now and then. However, one out of three has no specific goal for their savings. Teenagers’ average savings amount to about 700 euros.

The survey showed that the savings of the teens from families with average income have decreased by more than one fifth since 2007 (from 740 euros to 580 euros). As there are not as many summer jobs available and as the parents and relatives of average income families no longer give extra money to their teens, they have had to spend some of their savings during the recession. Has the recession hit them the hardest?

In Finland approximately 40,000 young students work from time to time (13% of the interviewees). The number of students working during school holidays has decreased since 2007, and based on the survey it seems that there are fewer summer jobs available for young people. Girls work more frequently than boys, and in Southern Finland working is more common than in the rest of Finland. Particularly 15-17-year-old girls seem to have more spending money thanks to jobs outside their studies.

Having their own money teaches teens to manage their finances

Anu Numminen, Nordea’s Private Economist, encourages parents to give pocket money to their children and teens regularly, because it is a good way of teaching them how to keep an eye on their spending and finances from the beginning.

- Having their own money will teach young people to understand the value of money. At the same time, they have to think more carefully about their choices, comparing the features and price-quality ratio of different products, says Anu Numminen.

Nordea had a survey made on the finances of teenagers for the second time in September 2009. In Finland, 1,028 young people were interviewed. Similar surveys were conducted in Sweden, Norway and Denmark. The interviewees were aged 13 to 17. In Finland as a whole there are 330,000 people in this age group, so it is an important consumer group. Synovate carried out the survey on behalf of Nordea. The first survey on this subject was made in 2007.

Anu Numminen
Private Economist