Let’s talk about teaching children about finances

As we enter a New Year many of you might be thinking about your finances, but have you thought about how or when you should start teaching your children the importance of money? The University of Cambridge has found that by the age of 7, most children are capable of grasping the value of money. This research has also shown that giving children financial decisions appropriate to their age can help them to form positive habits.

Unfortunately, in most schools, children aren’t taught about the value of money and how to manage their finances. This BBC Sounds podcast shows that many children around the world don’t have resources to learn about how money affects their lives, but would like to learn. It also mentions a few different tools that you could utilise to help your children improve their knowledge on finances.

You could consider opening a savings account for your children to help them learn about money management, by allowing them to have control over a small pot of money. You could talk them through the benefits of saving or spending, and you could guide them to make the right financial choices, which hopefully they will continue to do as they grow up. Our previous blog could give you some ideas on methods of helping your children to save. If you want to start gifting your children some pocket money, but aren’t sure how much is reasonable, you can view the average guide for their age on Statista, this graph ranges from 4 to 14 years of age. There isn’t a right or wrong answer when it comes to giving your children pocket money, some parents choose to, and some don’t. However, as children start to grasp the concept of money by age 7, it could be that this is a great time to introduce them to small amounts of money to help with their learning.

Saving money isn’t the only important thing we need to teach our children when it comes to their financial education. There are a variety of other topics which can be covered that can help increase their understanding of finances, such as household bills, borrowing and budgeting. When speaking to children about money, they could potentially find it a little boring. Therefore, it’s important to make it as fun as possible to help them engage with the content. There are various free online activities available to help and we have put together a few to get you started. All the websites linked below cover a variety of financial topics for a wide selection of ages.

• Values Money and Me has some great information for kids and families and they also have a teachers area with lots of activities for Key Stage 1 and 2.
• My Bnk has a selection of home school programmes for 5 to 14 year olds. They also have a section for 16+ that deals with topics such as going to university and independent living.
• Money Helper has a section on their website dedicated to educating children and have selected guides for different ages groups.

Ultimately, by helping your child or grandchild learn about money, you’re helping them to develop key life skills that can help them in the future.