The concept of money and saving is a crucial part of being financially independent and responsible.
Blacktower Financial Management surveyed 1,500 UK parents to understand how parents talk to their children about money. The study reveals that too many mums and dads are neglecting their duty to educate their children about money matters.
The recent survey data has revealed that an astonishing 51% of UK parents struggle to talk to their children about money matters, with 6-in-10 parents (63%) not regularly discussing finances as a family.
With 59% of parents believe their children should grow up blissfully unaware of how and why it is important to start saving. This is a pleasant theory, but a lack of understanding around basic finances can leave children falling behind as they grow up and struggle to manage savings and outgoings.
At what point are parents discussing money with their children?
Contradictory to the number of parents struggling to talk to their children about money, 4-in-5 (78%) worry about their child’s financial future and that an additional 84% of parents appreciate the importance of helping children learn about money. So, despite all this, why do parents still find it so hard to discuss finances with their children? Blacktower have analysed when on average UK parents start talking to their children about money matters, see below:
- Saving for college / university – Teenager
- Pocket money – 12 years and younger
- To start saving early – 12 years and younger
- Making a budget – Teenager
- Managing and avoiding debt – Teenager
- Having good credit – Teenager
- Investing – Teenager
- Using credit cards – Teenager
- Buying a car – Teenager
- Renting – Teenager
- Paying of loans – Don’t speak to their children about this subject
- Saving for retirement – Don’t speak to their children about this subject
- Pension – Don’t speak to their children about this subject
Top tips for educating children about money
Talking to children about money is a crucial step in their development and helps them to become independent as they grow up. However, not enough parents are discussing the importance of saving or paying people back. To make this a little easier, Blacktower have outlined our top three tips for educating children about money:
1. Take your children shopping
Letting your children accompany you when you visit the supermarket can be a great lesson in money management. Let them pick what they want to eat for lunch over the next week, but set a spending cap. For instance, they may have to choose between fruit or chocolate. Not only does this help them learn about budgeting, but they’ll also develop an idea about value.
2. Let your children make mistakes
The best way for children to grow and mature is to let them make their own mistakes. Watch from afar and let them spend their pocket money how they please. As and when they run out, and come to you for more, talk to them about why it’s important not to spend all your money at once. The more freedom you give them, the more responsibility they’ll begin to take over their own money.
3. Introduce cash at an early age
The best possible way you can educate your children about money is to introduce the concept at an early age. Traditionally, children are first exposed to saving with piggy banks. These are a great idea, because they allow children to develop a great feeling about finally reaching a certain amount, which will carry through to adolescence and adulthood.
John Westwood Group Managing Director at Blacktower Financial Management comments on the study “It’s eye opening to see the large percentage of UK parents struggling to talk to their children about money even though parents know they are the biggest influencer over the development of their child’s money management skills. We hope that our useful tips will help you to start educating your child about money and have a positive impact on your child’s financial future.”