Know-it-all teens may not be as "clued-in" as they think

A survey of 'sixth-form' aged students - from 15 years to under 18 years - has shown that despite awareness of the existence of loans, credit cards and overdrafts, if they are asked to budget for a fixed income, they can't manage for even a week.

An experiment conducted by AXA saw the youngsters taking over financial control of their household income for a week - yet seven out of ten had overspent on foodstuffs and bill payments by the end of the seven days.

Professor Nick Chater, a member of the AXA Financial Task Force, said: "These studies emphasise what a huge challenge budgeting can be when you're still relatively new to managing money and making regular financial decisions.

"Many teenagers are on the cusp of leaving home for university or to get a job and while some will naturally approach money with diligence, our study suggests that they simply may not be able to cope with budgeting effectively. This may explain why so many children are already considering getting overdrafts and credit cards. Over half of our respondents said their parents give them more money if they run out and one in five knows they will get what they want, if they are persistent enough in their requests."

May 23^rd 2008

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