Paying children for chores helps with financial management in adulthood

The survey, from the Financial Services Compensation Scheme (FSCS), reveals that just 50 per cent of parents pay their child regular pocket money.

Many of those who do give their children regular handouts do not give their child free rein to spend the cash how they like.

More than half (54 per cent) of parents who give pocket money are concerned their child would simply buy chocolate and sweets if they could spend the money how they liked, while more than a third (37 per cent) said their child would buy something they do not really need.

Yet, as with setting children chores so they can earn their pocket money, allowing your child to have a small amount of money to spend how they like - even if this leads to them making mistakes - can help them build experience of handling money.

They may even avoid making bigger financial mistakes when they are older as a result.

Rather than raiding their whole piggy bank, a small portion of cash could be set aside for a child to spend how they like, which could help them learn how to set a budget and stick to it.

Nearly a third (31 per cent) of parents said they tend to influence what their child buys with their pocket money and 24 per cent encourage them to save for a larger purchase.

But nearly four-fifths (79 per cent) of parents agreed that if children can engage with money from a young age, it would help them learn and appreciate its value.

Mark Oakes of the FSCS, which protects savers if their bank or building society goes bust, said: "It is a parent's choice how they want to get their child thinking about money, but giving them a little sum of their own to manage is a great way to start.

"They aren't going to get it right every time, but children need to be given the opportunity to make their own mistakes and learn for themselves."

Meanwhile, separate research suggests that many children are not confident about their money skills.

Just over half (55 per cent) of children aged between seven and 15 years old worry about their lack of financial knowledge, a survey from the bank NatWest has found.

The study, for NatWest's MoneySense financial education programme, found that more than two-fifths (41 per cent) of parents do not talk about money management at all with their children.

Gaps in parents' financial knowledge may explain the reluctance of some to talk about money. More than a quarter of parents (28 per cent) worry about their children asking them questions about money that they themselves cannot answer.

Yet nearly two thirds (62 per cent) of parents also worry their child will grow up without a good grasp of managing money.

Given that a new report from the Centre for the Modern Family, a think-tank set up by life and pensions company Scottish Widows, has found that parents spend thousands of pounds helping adult children start their careers, perhaps now is the time to sit down and start having those money conversations.

The Centre for the Modern Family research found that parents can expect to spend almost £8,000 to help their grown-up child reach the first rung of the career ladder.

On average, parents who had helped to kick-start their adult child's career said they had spent £7,900 per child. This could include money they had given their child to pay for a course or training fees, equipment or accommodation while studying and smart clothing for job interviews.

Meanwhile, with banking group Santander noting that young adults could be more likely than the population generally to fall for a financial scam, the need to educate people from a young age in all aspects of personal finance becomes even more clear.

People aged between 18 and 34 were more likely to believe, wrongly, that their bank might ask them for their full PIN, password or security numbers, or ask them to transfer money out of their account for "security reasons" Santander found.