According to GoHenry, over 70% of 6-18-year-olds in the UK and US say earning their own money is important to them.
Additionally, 42% of 16-18-year-olds say the Cost of Living crisis has led them to “start saving early for big life events.”
These ‘big life events’ include buying a house, taking driving lessons, going on holiday, moving out and going to university. These savings are likely due to less dependence on parents for such events.
GoHenry also reported 71% of children worry about the Cost of Living crisis. Responses from children saw them wanting to help their parents during difficult times. For instance, 25% of 9-year-olds say they would use their pocket money to help with family food shops. Additionally, 54% of 16-year-olds said they had a part-time job or were looking for one to help their family earn extra money.
Further research from UCAS also found that 79% of teens starting university worried about finances, which could lead to them wanting to earn a little extra.
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GET YOUR DIGITAL TOOLKITThe digital space means kids can make money in a range of ways. These are some of the more popular routes they take.
Video games like Roblox allows users to create and sell their own content. This content can include ‘skins’ or accessories for user avatars as well as mini games, worlds or other assets.
In Roblox, the Creator Marketplace gives users an easy way to share their creations with others. It works similar to other online marketplaces in that users can review products and browse items. To use this service, users must be 13 or older and verify their account.
Once Roblox creators earn a certain amount of Robux from sales, they can then convert this virtual currency to real currency. This is only available for creators, not other users.
Earning through video game streams is also popular, especially with options to monetise content. GoHenry says “as many as 18% of kids earn money through online gaming.” This is usually only available to those aged 13 and over, and parents will often be in charge of managing account content.
According to GoHenry, 25% of 6-18-year-olds in the UK sell things online to make money.
From selling used clothes to earning money from crafts, many kids make money online with marketplaces. However, parents will often need to own the accounts in these marketplaces for children to make use of them. This is due to country age requirements and safety concerns.
Depop is a social e-commerce platform that lets users buy and sell secondhand items. Most items on Depop are clothing items.
Like social media platforms, users can follow others and view an ‘explore’ page that suggests items to purchase.
To sell on Depop, users must be 13 or older. However, children under the age of 18 must get parent permission. Additionally, the payment system is linked to Paypal, which requires users to be 18 or older. As such, children are unlikely to use Depop without parents or carers knowing.
Depop has a user base of about 30 million users and most are aged below 26-years-old. While there isn’t an exact figure for how many are under 18, the focus on teens and young adults suggests a large number.
In a survey of Gen Z users, Depop found that 75% of 2167 surveyed users said their main reason for buying secondhand items was to reduce consumption.
Etsy is an online marketplace that promotes handmade and personalised items for sale. Children aged 13-17 can sell on Etsy. However, parents or carers must create the account and shop for under-18s. Additionally, the financial information, preferred name and email address must all belong to the parent.
Children can then sell items they make such as drawings, crafts and other creations.
There are over 95 million active users on Etsy across the world. However, because account owners must be 18 or older, it’s impossible to know how many are under 18.
However, Etsy is most popular among 18-35-year-olds with 30% of sellers living in the UK.
Vinted is an online marketplace designed for buying and selling secondhand clothing and accessories. Its Terms and Conditions say the service is not for those under 18. However, parents can create these accounts on their children’s behalf. They take responsibility for any activity on the account.
Teens can sell their old clothes to make money (and space) for new items. Like Depop, Vinted encourages users to recycle and purchase used clothes rather than spending regularly on new items.
Because Vinted is for those aged 18 and over, it’s difficult to know how many children use the service. It has millions of users around the world with over 8 million in the UK alone. It’s likely that many teens and young adults use the app to build their wardrobe and style.
Along with making money online, there are also plenty of opportunities for spending. These are some common ways children spend money online.
Professor Dmitri Williams teaches courses on technology and society, games and data analytics. When it comes to video games, he says that the way we buy video games has changed — from something we’d buy in person to something we now download or have as part of a service. “That’s meant that rather than making money up front on a sale, game developers have turned to other income sources. . . . The solution has been to either make a game inexpensive or free, and then to upsell things inside it later on.”
He says that these charges can either lead to savings or more expenses. “Essentially, the developers have found a way to get people to pay however much they want to, rather than one set price.”
Learn how to manage in-game spending to help keep kids' experiences positive.
GO TO GUIDEProfessor Williams says that there are 4 categories when it comes to in-game spending.
“The first is simply more of the game. If we think about games having content like a TV series, then more of it is like another episode or season. That might mean more places to explore, more villains to defeat, etc.”
“The second is virtual items within a game. Usually these are things that will help the player compete like a faster car, stronger sword, etc.”
“The third are items that actually don’t help a player win, but instead let them self-express. These are things like a colourful hat, a fancy gun or even a whole different appearance for their character or in-game avatar. Surprisingly to many, this is a very large portion of spending; it goes to show how important identity and expression is for players of all ages.”
“Lastly, many of these games are free or are driven by watching ads, and so the player can instead pay with their time or attention. Game developers often build in ways to skip these steps to get to the good stuff without either grinding away meaninglessly (the developers make portions not fun so players want to skip it) or watching ads. Naturally, they allow this with small (or large) purchases.”
“Many of these purchases are small and are called ‘microtransactions’ (MTX), though some escape the micro definition and can become quite expensive.
When new content becomes available as an add-on to the original game, that’s called ‘downloadable content’ (DLC).
Some video games allow players to help create the content (whole games, cosmetics, levels, etc.), which other players can then consumer or buy. Sometimes they offer players a cut of the profits, and sometimes not. The stuff players make is called ‘user-generated content’ (UGC).
A new look for a character or an object in a game is a ‘skin‘, which means it retains its original function and usually its shape, but now it looks different. An example would be a female elf is now dressed up like a modern rock star, but otherwise can do the same things.”
Research shows that more children and teens are saving for future expenses or paying for their own services. For instance, 11% have begun paying for their own entertainment such as cinema and sporting events. Furthermore, around 3/4s of young people don’t expect their parents to pay for their wedding, education or towards a new house.
With apps like Depop and Vinted, many young people use the money they earn to then reinvest in other items. For instance, a teen can sell an old jumper and then use that money to buy another jumper that’s new-to-them.
Research from both Depop and UCAS suggest young people are spending more consciously, whether that’s to save money or make more sustainable choices.
However, plenty of purchases are made to online marketplaces like Amazon or online shops like Nike. The Economist also suggests that Gen Z are more likely to purchase items considered ‘luxury’ to older generations, which often include self-care items. Children and young people are more likely to put wellbeing purchases ahead of other purchases.
Buying and selling online can have many risks as well as benefits. Here are some ways to increase those benefits.
With online banking and e-commerce, the internet offers many ways to help children build financial literacy skills. And doing this helps children understand and manage budgets for things they want to buy or sell.
See how mum, Steph, helps her children learn key finance skills:
Whatever the online issue, talking regularly about it is the best way to keep kids safe. When you have regular, open conversations, you give children the opportunity to express any concerns or to teach you about their digital space.
With online finance, regular conversations about making money can help your child develop a good relationships with buying and selling online.
You might consider talking about:
If your child sells items online, they will need your help creating an account on most platforms. This is a great opportunity to encourage their entrepreneurial spirit while also keeping on top of what they’re doing.
Set time aside every week to check in on how the shop is doing, and talk with your child about their sales as well as their aspirations. While selling things online can teach valuable skills, it should not get in the way of schoolwork or other hobbies. Regular conversations can help you talk through any struggles with them.
Beyond financial literacy, children can learn a range of skills when it comes to making money online. Instead of focusing on the income or spending that comes with e-commerce, encourage the others skills they’re learning.
While seeing your kid making money online can cause some concern, with your guidance and support, you can ensure they experience more of the benefits than the risks.
Dmitri Williams (PhD, Michigan 2004) is a professor at the University of Southern California Annenberg School for Communication, where he teaches courses on technology and society, games and data analytics.
His current work focuses on the study of influence among populations through the concept of ‘social value.’ His ongoing work centres on the social and economic impacts of new media, often within online games. He works actively with companies and startups across the tech sectors.
His work has also been featured in several major media outlets, including NPR, CNN, the Economist, the New York Times, the San Francisco Chronicle, the Chicago Sun-Times and others. Williams testified before the U.S. Senate on video games and has served as an expert witness and consultant in federal court cases.
Visit dmitriwilliams.com or follow him on LinkedIn.
While GoHenry did not contribute to this guide, their research helped inform much of the content within this guide.
GoHenry is a financial technology company that focuses on financial education for 6-18-year-olds. The company offers a Visa debit card and app for under-18s to help them develop financial literacy skills.
In this guide, we referred to the following research from GoHenry:
