What are apps teaching kids about money?

While both parents and children report schools aren’t doing enough to teach financial literacy, 75% of American parents (and 74% of kids) believe financial apps are ‘a good way to teach [kids] about financial matters’.

Games tied with food as the number one purchase made by kids, followed by toys (tied with clothes). A survey conducted by Australian parenting website raisingchildren.net.au also found that entertainment, toys and games represent the biggest pocket money spend.

But what kinds of lessons might kids be learning from apps?

As I write this post, it is currently ‘Screen-Free Week‘. Like any tool, smart phones, computers, tablets and televisions may have enormous potential to educate and to enrich, as well as to connect us.

But this potential all depends on what we choose to do with them. And what our screen time is at the expense of. While 12% of US parents say using digital media has led to them spend more time with their children, more than double say it has decreased the amount of time they spend together as a family.

Digital chores, digital pocket money, digital spending

80% of parents in the UK are introducing their children to digital money from a young age. 34% transfer a weekly amount of pocket money into their children’s accounts and 28% pay their children in digital currencies for use in gaming communities.

Children are increasingly completing ‘digital’ chores for pocket money, and some receive digital currency for use on app stores. Claudia Hammond may be right in her speculation that today’s children may not make the ‘sometimes dangerous distinction between cash and cashless – respecting the first and being cavalier with the second’ in the same way their parents or grandparents may have.

How games teach kids about money

According to Words at Work and Play, games, including digital games, force players to envision consequences around the question ‘If I make this move, what positions will open for me, and how will my move determine the actions of the other party?’ Particularly as it appears children’s opportunities for such discussions with their parents may be becoming less frequent, it is crucial to understand what kinds of opportunities games are providing.

The Google Play store is currently the largest online app store. All top-ranking ‘money’ apps at the time I searched were for adults (e.g. budgeting apps). In order to examine the money-related narratives children are more likely to encounter, I analysed the top 250 paid and 250 free apps in the ‘family’ category.

The descriptions of 33/250 free apps, and 26/250 paid apps mentioned ‘money’. However, the majority of these mentions were in the phrase ‘real money’. This raises the question, if some money is ‘real’, what money isn’t real?

App descriptions frequently contrasted ‘real money’ with ‘coins’. Individual apps from Nickelodeon, Disney Publishing, and many from TutoTOONs referred to ‘coins’.

Some money is worth more

Many apps use the term ‘gem‘ to refer to ‘premium currency‘. UX Planet defines in-app currency (IAC) as ‘the fabricated currency tied to a specific app that allows users to purchase assets’ which comes in two forms – simple (‘coins’ in the case of EG) and premium (‘gems’ in the case of EG).

Simple IAC like coins are ‘earned easily within an app and used to trade for common assets. Simple IAC is the most readily available and easy to come by currency in an app’.
Premium IAC ‘has increased rarity within an app and is often used to trade for higher-tier assets. Premium IAC can be earned within an app but the simplest way to acquire more is to purchase it’.

Money does grow on trees

‘Money doesn’t grow on trees’. It’s a common idiom, and the name of several books for parents and children. But in TUTOToons games, players visiting the ‘coin tree’ are encouraged to ‘come back every hour and get your rewards’.

While a ‘money tree’ may seem to teach children about entitlement rather than work, a more considered analysis may reveal parallels with an interest bearing bank account or other investment. Although the payout is not linked to a particular amount ‘invested’, parents and kids can discuss the notion of value increasing over time, and the importance of patience.

There is a clear motivation for the developer to encourage frequent engagement with the app, to ensure more ad views. But the importance of regularly checking one’s investments is also apparent. As a number of bank accounts now include incentives such as a higher interest rate if account holders deposit a certain amount of money each month, there may be other transferable skills and mindsets involved.

‘Money’ in games

Only 8 apps made reference to money outside of the phrase ‘real money’. One of these, Sky Whale, only used ‘money’ in the context of a booster called ‘Double Monkey Money Toilet’.

I divide the remaining uses of the word ‘money’ into two categories. Those that use ‘money’ to refer to their IAC (the free apps, and a casual paid app) and those that use ‘money’ to refer to a topic of learning (the two paid educational apps).

Money as an in-game currency

– ‘Make money by selling grass or chaff at the Biogass Plant’ (Farming Simulator 14)

– ‘Play one of the 45 mini-games and earn money!’ (Moy 5 Virtual Pet Game)

– ‘In this management game you need to help your customers to get the right dress, fit the dresses and of course get your money!’ (Wedding Shop – Wedding Dresses)

‘On some adventures you’ll even unlock in-game money that you can use for shopping!’ (LEGO Friends)

Money as a topic of learning

– ‘Teach them multiplication, money, time, punctuation, spelling suffixes and more… Counting Money – Count money uses nickels, dimes, quarters, and bills’ (Second Grade Learning Games)

– ‘Learn about numbers and money’ (Dr. Panda Supermarket)

The description which mentioned money the most times was that of Vending Machine Timeless Fun:

Vending Machine Timeless Fun will help you to know money and how you can use it to buy different items in-game. Of course all the money in this game is free so you can tell your parents to relax. But if you want a soda pop, you need a certain amount of money. This game will let you get to know how to save money and how to spend it in the right way!… Learn how to handle money in a fun way!’

Purchase every drink ‘Just because you want it, and just because you can’ extols the description. As the excerpt shows, this app draws upon both these sense of money, money as an in game currency (‘all the money in this game is free’) and a topic of learning (‘learn how to handle money in a fun way!’).

The app essentially involves two modes, one in which an arrow indicates which product the user should purchase, and an endless mode in which the player may buy anything they wish. Although the player must insert the minimum amount of coins, they don’t receive any change. As the pile of coins at the player’s disposal never diminishes, ‘saving’ is not actually possible.

Farming Simulator 14, which made no explicit claims to teaching, nevertheless entails a number of opportunities for children to learn about money-related topics such as investing, hiring workers, and markets, suggesting that educational claims and content are not always correlated

Are freemium games truly free?

Although some games, such as T. Price Rowe’s Great Piggy Bank Adventure appear to prompt changes in saving and spending, Lusardi states that many of these applications ‘may preach to the converted’. Indeed, around 40% of parents making use of T. Price Rowe’s game had incomes of over $100,000, and more than a third held graduate degrees. According to Rideout, author of The Media Family and Generation M, falling consumer electronics prices have allowed lower-income and minority families to catch up in device ownership. But an emerging ‘participation gap’ demarcates less and more enriching uses of media.

The same may be true of board games. Rich Dad, Poor Dad’s CASHFLOW for Kids currently costs $62.49 (including shipping and handling).

Monopoly Junior Edition is available for less than a quarter of the price.

When it comes to apps, developers at the Children’s Media Conference reported difficulties breaking even. It seems parents ‘prefer to let their children play freemium games like Clash of Clans or Candy Crush Saga’. Kids, too, may prefer games designed to be fun and addictive over those marketed as educational in order to get parents to part with their cash.

5 Tips for Finding Kids Apps5 tips for finding great apps

  1. Watching out for ‘inappropriate’ content isn’t enough. Consider the messages apps are sending your kids. How much advertising are they viewing through freemium games?
  2. Support the makers of quality apps. Just because a well-known company produces an app does not mean it has good content. Just because a developer is independent does not mean their work is low quality.
  3. Look out for key words like ‘real money’ and ‘gems’ which suggest an app might use premium currencies. Is telling kids the easiest option is to ‘pay to win’ really the message you want to send them?
  4. Look past the ‘education’ label. It’s easy to claim something is educational, it’s much harder to back it up with appropriate theory, pedagogy and research.
  5. Remember nothing is truly free unless it is given out of love. Look for the motives behind any free offering – including freemium apps you download for yourself.

Bonus tip: you may like to check out @edappadvice on Twitter!

This is our last post in the series on kids and money (you can catch up on the others starting here).

If you enjoy #enrichmentality please share it!

Today’s featured image is of one of the kids’ apps I tested – and what kinder-themed picture in Germany would be complete without some gummi bears? Okay, you caught me – they’re actually the much cheaper ‘Mega Bears’ gummibonbonmischung from Aldi, because a gelatinous bear by any other name tastes as sweet!

Do you use mainly paid or free(mium) apps?
If you have kids, do you download pair or freemium apps for them?
Let me know in the comments!







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11 thoughts on “What are apps teaching kids about money?

  1. Computer games need to be extremely limited period. Yes every child reacts to the sales ads and yes too many children have them.

    Your article is very well written and worth the read. Thank you for sharing.

    1. Thanks again for your kind remarks Leanna, I’m so glad you took the time to comment.
      I agree that like anything, there needs to be a limit to screen time. I also strongly believe that there are better ways to spend time on tablets or mobile phones, and not-so-good ways – but that discussing the money messages presented in the media is vital.
      Thanks for your comment!

  2. Great article! I try to keep a good watch on what my kids are playing on their devices but you have brought up good points that I hadn’t thought of. Thank you for sharing at Ravenwould.

    1. Thanks for stopping by and for leaving a comment Kileen! I’m glad this article was of some use to you. There are so many things to look out for, but I think that even the not-so-good money messages in apps can result in ‘teachable’ moments 🙂 Thanks for hosting, too!

    1. Absolutely agree Amber – we need to recognise computers, tablets and phones as the ‘gateways to the world’ that they are. They have their dangers, but also plenty of incredible opportunities!

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