Why your kids have no idea what things actually cost

Darren Savery
Why your kids have no idea what things actually cost

Last Christmas, I asked my son what he wanted from Santa. He said “a drone.” Not just any drone - one costing £800.

It dawned on me that he knew the number. He just had no idea what it meant.

To a child growing up today, money isn’t a stack of coins or the weight of a wallet. It’s a flashing green light at a card reader. There’s no visible connection between the amount they have, what things cost, and the time or effort required to turn one into the other. The number exists. The work behind it doesn’t.

In the modern digital age, this disconnect is more profound than at any point in history. Children rarely see or feel real money. We’ve entered an era of frictionless spending — convenient for us, devastating for them. A £200 grocery shop and a £3 coffee look identical from the other side of a contactless terminal.

The Tap-and-Go Generation

This isn’t just technology advancing. It’s a deliberate commercial decision.

In 2013, cash accounted for 51% of all UK payments. By 2023, that figure had fallen to 12%. Only 8% of UK adults now use cash all of the time. Retailers didn’t stumble into this - they engineered it. They spent years removing friction from the buying process because they know that when paying is effortless, people spend more without hesitation.

For children, that friction was never just an inconvenience. It was the lesson.

As one expert from LINK put it: “If you hand over cash, you physically realise you’re losing it.” That physical sensation - the weight leaving your hand, the pile getting smaller - was the earliest financial education most of us ever received.

I remember opening my piggy bank and sorting the coins into silver and bronze piles. Counting the pound coins. Feeling the heft of it. I knew, in a way that required no explanation, that money was finite.

Those days are long gone.


I’ve been thinking about this problem long enough that I built something around it. Morechard is a family finance app designed to make the connection between money, effort, and reward visible again - for kids and parents alike. If that resonates, take a look.

Frequently asked questions

Why don't children understand the value of money?
Because most children today never handle physical cash. Contactless payments remove the felt sensation of spending, so money remains an abstract number rather than a finite resource with real weight.
How has contactless payment affected children's financial literacy?
Cash fell from 51% of UK payments in 2013 to just 12% in 2023. Children who never handle money miss the earliest and most instinctive financial lesson - that spending means losing something tangible.
At what age do children form money habits?
Research from Cambridge University found that money habits are largely formed by age seven, making early exposure to the reality of money critical.