Parental financial role modelling and fiscal behaviour of young home leavers

Abstract

PurposeThis paper aims not only to provide an insight into the nature of the relationship between parental financial role modelling and consumption behaviour of young people, but also to explore the consumer socialization process that children undergo in the parent‐child dyad.Design/methodology/approachQualitative research in the form of personal in‐depth interviews was conducted in order to extract new knowledge and reach a greater understanding regarding the impact that this relationship may have on future consumption behaviours within the youth market.FindingsIt is clear that parents are able to exert a huge amount of influence over the financial behaviour of their children (although this obviously differs between families) and are able to do so through the informal teaching of financial lessons, by allowing children to observe their own financial patterns and by guiding their children through significant financial decisions by offering advice and approval (or disapproval) when asked. Key financial attitudes and behaviours of young home‐leavers are almost directly related to the parental financial education they received whilst growing up and still living at home and in many cases parental influence is still present even once the child has moved away from home and is responsible for making their own financial decisions.Research limitations/implicationsAlthough there are limitations, the present study does have implications for the impact parents can have on the spending behaviour of their children; it may be that the most important thing parents can do is teach their children about financial responsibility and successful consumer decisions at a young age so that they grow up with these life skills.Practical implicationsIn terms of practical implications, by identifying the specific areas where financial knowledge and awareness may be lacking, the research may help educational and financial institutions to design financial management courses in order to help young people achieve greater financial freedom.Social implicationsThe paper reveals the characteristics of the consumption relationship children enjoy with their parents, describing the role of financial education within families and conceptualising the various forms of consumption relationships that exist between young consumers and their parents.Originality/valueThe relationship between parental influence and youth consumption behaviour has already been identified using quantitative research methods but very little is known about the actual extent of this relationship, which is addressed by this paper.