Parents these days talk openly with their children about subjects that were once uncomfortable or taboo. Sex, relationships, staying safe – most of us are better at discussing these things with our kids than our mums and dads were with us.
Money lags behind on this trend. Children’s attitudes to money are formed early on – yet many parents are unsure when or how to start the discussion.
This isn’t surprising as most of us are daunted by the subject of money. But today’s children will ultimately have to fend for themselves financially – so it’s time to get the conversation going.
Kids are forming their perceptions of money as early as three and four. At this age, a money box can introduce them to the idea that money should be kept safe – and putting some change in the box together is fun. Setting limits when out shopping and telling them why they can’t have things also helps children learn the value of money.
Pocket money rules
Remember pocket money? Well, it’s still one of the best ways to get children used to making choices about money. Explain to them that if they spend pocket money every week they won’t be able to save for the game or other item they want. Handling coins and notes also makes money real to children who are used to seeing us paying for things digitally.
Giving kids jobs to do around the house in return for their pocket money helps them understand that money comes from work. Help with washing up, tidying and feeding pets are tasks children can do from five upwards that will help them develop good habits – financial and otherwise.
Get children into the savings habit. Encourage them to set some of their pocket money aside for something they’d like to buy. If they get cash for Christmas or a birthday, suggest they save some of it. You could offer to contribute if they save a certain amount. Starting a junior ISA is a great way to lead by example by showing children you are saving for them.
The more you involve children in the everyday business of budgeting, spending and saving the better. It might get you thinking too.