If you have a child or children then you might wonder how you will manage to teach them about finance. There are many things to learn and if we were not taught, we may realise how important it is to teach our children so that they do not make mistakes like we did. However, it is not always that easy to work out how to teach them. Setting a good example by being sensible with money yourself will be a really good start. However, this can be too subtle and so it is wise to do some proactive teaching as well so that you can really show the children all about saving.

From a young age

When they are very young there is still a lot that we can teach them. Buy them a money box and show them how to put their coins in it so that they can save them up. They may not understand their values or what each coin can buy but showing them the pleasure of saving can be a really great start. Open them a bank accounts so that they can pay in larger amounts and get interest on them. Talking to them about savings can be great and explaining that they will get money from the bank as a reward for their money being in there could help them to want to save more.

At primary school

At primary school they will soon learn to count and so you can teach them to count up how much money they have. They will then be able to add up what they have and start to understand how much more they need if they want to buy certain things. They can start to learn about saving up their money to buy more expensive items. You might also want to start giving them pocket money and you might want them to start to save some and spend some. Perhaps you may prefer they save it all or you pay it directly into a savings account for them. Having pocket money will allow you to discuss spending decisions with them. Starting to explain to them about how much you spend for things will help them to start understanding how much it costs to run a household and

At secondary school

Once they get to secondary school, they should have a really good understanding of maths. This is where you can start to show them sales and reductions and interest rates and teach how to calculate them. So, they will be able to calculate how much something will cost if it has a percentage reduction as well as how much interest they might get based on the interest rate. This will help them to understand whether they will benefit from saving or from buying items in a sale. Encouraging them to make sensible spending decisions while they are younger will help as once they enter teenage years they may be more difficult to influence.


It is most likely that as they get older they will come to you in order to ask you for money. This will mean that you will have to be careful about what you do for them. You need to think hard about whether you will be prepared to lend them money or perhaps to give them money. By giving them money all you are teaching them is that there is a way to get money if you need it with no repayment necessary. This could mean that they will be careless when spending as they know that you will be there to fall back on. Lending is slightly better as they will know that they will have to repay it. However, you will need to think about whether you feel this is really helping them. You are likely to be cheaper and more flexible than a bank and they may not pay it all off in full before they inherit anyway. It might be that they will learn a better lesson about having to cope with a loan if they borrow it in a conventional way. You may also need the money to pay for a care home or you may wish you had it to pay for holidays or other things through your retirement and it may affect your relationship with them. It can be hard to help your children without being accused of interfering but if they ask for help then this could be a good time to help.

So, you can see that you will need to change your approach as your child gets older. It is wise to start young though as they will get used to the idea of saving money. Then as they get older, they might want to save more because they can see the amount of money that they have grow. It might discourage them from spending their money on sweets and toys that do not last long and encourage them to let it build up so that they can buy something much more significant hen they are older.

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