Mum Knows Best - Britons’ money habits are most influenced by their mothers

Editor's note: the results of this survey are worth noting if we want to make sure that our kids grow up handling their money well!

Britons’ money habits are most influenced by their mothers

• 36% of Brits say that their mothers have had the most influence on the way they handle their money
• We are twice as likely to consult Mum than Dad on our daily spending
• More than half of people say their father took control of their household finances when they were growing up

New research from M&S Money reveals that our mothers are the biggest influences on our financial habits.

M&S Money surveyed 1000 people to find out about how their family has influenced their finances. The research reveals that 36% say that their mothers have had the most influence on the way they handle their money, compared to 32% who say it is their fathers.

Grandparents (3%) and siblings (1%) have little influence while 24% say their family have no influence over their financial habits at all. It seems we also follow our own gender as a role model; women are most likely to say it is their mother that has most affected their financial habits (39%) while men are most likely to say that it is their father (36%)

When it comes to their daily spending, more than twice the number of people would consult Mum for her point of view instead of Dad. 22% would ask their mother about their day to day finances, while just 8% would consult their father on matters such as shopping or saving. Indeed, 6 in 10 people say they are not like their fathers at all when it comes to their finances.<.div>

It is only when the stakes are high that we turn to our Dads for occasional advice. When making large financial decisions such as buying a house or a car, one in five (20%) would turn to their father for advice compared to 11% who would ask their mothers.

Despite more people saying their Mum has been the biggest influence on their money habits, more than half (55%) of people say their father took control of their household finances while they were growing up, while for 40% it was their mother.

Colin Kersley, Chief Executive of M&S Money, said:

“While it may not always have been our mothers who controlled large financial decisions and the overall household budget when we were growing up, it seems they are now the ones who we are most likely to turn to for advice on day to day matters such as saving and spending.

“Our fathers do still have a clear role in being first point of call for advice on bigger purchases. It is great that we see the value of both parents in helping us through the many different financial decisions we face on a daily basis such as choosing the best home for our hard earned cash.”

New parents urged to seize nursery tax benefits

New parents who pay higher-rate tax are being urged to ensure they join their employer’s nursery voucher scheme before 6 April otherwise they could lose more than £1,000 tax relief due to planned cutbacks, says Baker Tilly.

Changes to employer supported childcare to be introduced on 6 April will mean that higher-rate taxpayers, both at the 40% and 50% rate, stand to lose at least half of the current annual relief offered if they have not joined an existing scheme before the new rules take effect. Tax relief is also available to parents using any form of ‘registered’ or ‘approved’ childcare.

Under measures announced in the June Budget, employees taxed at the higher and additional rate, who join a scheme after 6 April, will have their weekly allowable reliefs reduced from £55 to £28 and £22 respectively, as the the maximum relief for all taxpayers will be equalized to approximately £11 per week. Employees already part of a scheme will not see their relief affected by the changes.

Currently, higher rate tax payers can make annual tax savings of £1172 on childcare but those who join after April 6 2011 can expect to see their annual saving reduced to only £597. With two parents claiming, the amount of tax relief is worth more than £1,000.

Mark Collins, Head of the Employers Consulting Group at Baker Tilly, urges employers and employees to act now or they will lose their entitlement before the 6 April.

“Any employees who can join an existing scheme before 6 April will still be sure of obtaining tax relief at their top income tax rate – couples potentially avoiding a reduction of over £1000 a year in tax savings.”

“Employers who are considering setting up a new scheme or changing the terms of an existing scheme would be well advised to do so in time to enable all eligible employees to join in time. It will not be enough for the scheme to be in place: the employees must also have joined before 6 April.”