If you read our blog post from earlier in the month, you will know that we are passionate about teaching our children about money in order to improve their financial education and well-being.
This can be a difficult subject to navigate partly because parents have not necessarily had a brilliant grounding in financial education themselves.
If you go to the shops, take your kids with you – they learn by watching what you do. Involve them in the following conversations:
Nowadays, a lot of money is digital. This can make understanding the value of it quite difficult. Make money tangible for children so that they can gain confidence around using it.
For older children, get them to familiarise themselves with digital money and the apps that help you to manage your money. They need to be able to build confidence using money this way. A great way to do this is to show them your bank account balance before you purchase something. Then show them the balance afterwards to illustrate the difference.
Use coins to help small children learn to count. Get a pile of 1p, 2p, 10p, etc, count as you build piles and then smash them down!
After this, why not try coin rubbing? Put coins under paper and gently rub a wax crayon over the paper until the coin pattern comes through.
It is a good idea to start letting your children know that days out cost money, especially once they start becoming more familiar with finance.
School holidays can be a very expensive time with activities booked in order to keep the kids occupied. Before the holidays start, make a list with them (include limits!) on what activities they would like to do. Set up a jar and put an allowance in there. Explain to the kids that once the jar has emptied, there will be no more allowance given and this is the money that will pay for certain items when out and about. Keep discussing the jar and how much is left throughout the holidays – this will help older children with their budgeting skills.
The best way to understand something is to have experience in it. Pocket money is a great way for kids to understand money but also get the feeling of achievement from carrying out tasks and also delayed gratification from the saving of the pocket money in order to buy something that is really wanted.
With Christmas around the corner, now is a really good time to put a budget in place for them. A lot of kids, especially school age, will want to buy presents for their friends. Sit down with them, set a budget and draw up some ideas. Explain to them that if they do not have enough budget for all their friends, then they need to compromise and adjust their expectations.
Or suggest saving for something bigger from now until Christmas.
For younger children, the TV is a great aid in helping to understand money.
CBeebies Numberblocks is a great aid where your child can sing along to numbers. There are also CBeebies Numberjacks available which is a programme with superhero numbers with different characteristics.
For older children, gaming is a great way to earn tokens or virtual coins to then spend on extra levels within the game. This helps with determination to earn and also the gratification of spending the virtual coins.