Saving, Selling, Earning, and Negotiating: How Adolescents Acquire Monetary Lump Sums and Who Considers Saving

Abstract

This study examines the importance of saving during adolescence as one way of obtaining larger sums of money, and investigates differences between adolescents who choose to save and those who do not. To this end, the strategies “saving,” “negotiating,” “selling,” and “earning” are taken into account in designing a questionnaire. Two measures of saving behaviors are used: “general tendency to save” and “saving by adjusting expenditure” when faced with an income constraint. The sample consists of 470 British school students from age 11 to 18. Results show that up to age 15, the strategies “saving” and “negotiating” are equally important and more important than “selling” or “earning.” When 15 or older, adolescents prefer “saving” above “negotiating.” Regression analyses reveal that adolescents who favor “saving” when confronted with a short-term income constraint report a general tendency to save. Findings demonstrate the importance of developing positive financial habits early in life.