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Teaching Children to Save and Lifetime Savings: What Is the Best Strategy?

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  • Alessandro Bucciol

    () (Department of Economics (University of Verona))

  • Marcella Veronesi

    () (Department of Economics (University of Verona))

Abstract

We study the effect of alternative parental teaching strategies on the propensity to save and the amount saved during adulthood. Using a panel dataset from the Dutch DNB Household Survey we find that parental teaching to save increases the likelihood that an adult will save by 16%, and the saving amount by about 30%. The best strategy involves a combination of different methods (giving pocket money, controlling money usage, and giving advice about saving and budgeting). The effect of parental teaching is persistent with age, but decays at elder age for the propensity to save.

Suggested Citation

  • Alessandro Bucciol & Marcella Veronesi, 2013. "Teaching Children to Save and Lifetime Savings: What Is the Best Strategy?," Working Papers 10/2013, University of Verona, Department of Economics.
  • Handle: RePEc:ver:wpaper:10/2013
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    2. repec:bla:jconsa:v:51:y:2017:i:2:p:284-311 is not listed on IDEAS
    3. Sonya L. Britt, 2016. "The Intergenerational Transference of Money Attitudes and Behaviors," Journal of Consumer Affairs, Wiley Blackwell, vol. 50(3), pages 539-556, November.
    4. repec:spr:jbecon:v:87:y:2017:i:5:d:10.1007_s11573-017-0853-9 is not listed on IDEAS
    5. Holford, Angus, 2016. "Do parents tax their children? Teenage labour supply and financial support," ISER Working Paper Series 2016-05, Institute for Social and Economic Research.
    6. Berry, James & Karlan, Dean & Pradhan, Menno, 2018. "The Impact of Financial Education for Youth in Ghana," World Development, Elsevier, vol. 102(C), pages 71-89.
    7. repec:eee:jeborg:v:150:y:2018:i:c:p:62-85 is not listed on IDEAS
    8. Grohmann, Antonia & Kouwenberg, Roy & Menkhoff, Lukas, 2015. "Childhood roots of financial literacy," Journal of Economic Psychology, Elsevier, vol. 51(C), pages 114-133.
    9. Annette Otto & Paul Webley, 2016. "Saving, Selling, Earning, and Negotiating: How Adolescents Acquire Monetary Lump Sums and Who Considers Saving," Journal of Consumer Affairs, Wiley Blackwell, vol. 50(2), pages 342-371, July.
    10. Alessandro Bucciol & Martina Manfre' & Marcella Veronesi, 2018. "The Role of Financial Literacy and Money Education on Wealth Decisions," Working Papers 05/2018, University of Verona, Department of Economics.

    More about this item

    Keywords

    saving; teaching to save; children; allowance;

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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