“There are many ways that parents can start to encourage their children to interact with money from a young age said Kirsty Bowman-Vaughan, children and young people expert at the Money Advice Service. “We know that children learn best when they gain practical experience with money, and allowing them to make decisions and learn from their mistakes lays the foundations for better money management skills as they grow up.”
Here are five ideas to help your kids start to learn about money:
- Give children the chance to pay for things from an early age, with their own money. For example, instead of buying treats for them during your weekly shop, give them the money and explain to them that they can pick what they want, but when the money is gone, it’s gone.
- Include your children in discussions about bills, to give them an idea of how household finances run. Explain things like direct debits, monthly/quarterly bills and energy tariffs. Frame it in an engaging and interesting way – tell them they’re helping to keep the lights on, for example.
- If you give your children pocket money, encourage them to set a little aside each month to save up for something they really want. Regularly remind them to save, even if it’s a small amount each month.
- Open a savings account on behalf of your child. Try and save into it regularly, even if it’s just a few pounds a month. Include them in this, get them to go and make deposits in person at a bank branch and let them know how much money is in their account. Some of these accounts also provide a gift, like a moneybox, which can be a nice incentive to save!
- For very young children, just getting them used to what money is from a young age can be a great start. Give them the opportunity to handle money and explain to them what money is.
- For slightly older children, give them the chance to manage their money digitally, to get them used to things like mobile banking.