How does a little extra money affect children’s development?

The period between birth and eight years of age is crucial for children’s brain development, and it sets the foundation for their cognitive, social, and emotional skills later in life. At this stage, children’s brains develop faster and are exceptionally sensitive to inputs from the environment around them. Referred to as “early childhood,” this period has a remarkable impact on human wellbeing, learning, and success throughout life.  

How can poverty affect child development?

It is estimated that 356 million children are living in extreme poverty, growing up deprived of basic rights and resources such as food, water, healthcare, education, and housing. That means approximately 1 in 6 children around the world experience the most severe kind of poverty, having to live on less than the international poverty line of $1.90 per day. 

Children are more vulnerable to poverty than adults, and the economic hardship endured in early years can have lifelong effects. Studies have found that childhood poverty can impact a person’s achievements in adulthood, depending on the type of poverty and length of time it was endured. Experiencing poverty as a child increases the odds that a person will face it as an adult. There are many factors at play in the difficulty of escaping poverty, including fewer learning resources growing up and a harder time enrolling in and completing college studies due to the lack of funding. 

Why a little money means so much for families

Even just a little extra money can truly change lives for the better, a recent study by the Institute for Research on Poverty highlights. According to one of the study’s co-authors, “[t]he power of cash is that it can be used as the family needs it in the moment, to fix the car or buy diapers. It’s a powerful way to empower people to take care of themselves and that’s critical when it comes to taking care of kids”. The study found that children of parents given a monthly cash supplement in the first year of the child’s life showed significant developmental advantages compared to children of families without subsidies. 

Poverty reduction has been demonstrated to have a positive impact on early childhood brain activity and the development of cognitive skills. The resulting benefits for children are extensive and long-lasting, setting them on the way to realizing their full potential in the years to come.  

Direct cash transfers, whether they come from an assistance program or in the form of remittances sent by family members, are also essential for families who may not be considered to be living in poverty but are still at risk of economic shocks caused by unemployment, illness, natural disasters, or other adversities. While these families may not be in as much need of economic support as those already living in poverty, unexpected economic shocks can have dire effects, particularly on children, with long-lasting impacts. 

For hundreds of millions of children around the world, remittances have the potential for positive impacts on their development that will benefit them for the rest of their lives.  

The power of money transfers to help families overcome and prevent financial setbacks is one of the major reasons why remittances are so important for so many. People working abroad send money to their families back home so that they can live a better life and plan for a promising future. It is estimated that one billion people are involved in sending or receiving remittances. The number of lives these cash transfers can change is astounding.  

Remittances have the power to address many financial barriers families around the world face daily, allowing access to basic human rights like education and healthcare and helping to reduce inequalities all around.  

Save the Children & Ria: Building a better future together 

At Ria, we are committed to creating a world with fewer inequalities, one where people have access to all the support, resources, and tools they need to thrive. 

Our work is all about helping communities, families, and individuals get ahead by providing a fast, convenient, and safe service. We strive to ensure our customers’ funds get to where they matter affordably.  

Since the beginning of 2022, we have been sponsoring Save the Children’s projects in Mexico and the Philippines to help provide children at risk with the tools they need to build a better future. Children everywhere have a right to quality education, and with our partnership with Save the Children we are providing continued education and support to children at risk, making sure they grow up healthy, safe, and well cared for.   

Learn more about the activities that Save the Children is carrying out with our support in Mexico and the Philippines. 

For more info: comms@riamoneytransfer.com