How does everyone teach their kids about money?

[Wonderingaboutthing]

I’m wondering what other people do about teaching their kids about money and its value.

By way of context, we’re a quite well off family, kids 8 and 10. Not billionaires, but kids are in private schools, nice holidays etc. if I want to buy something (within reason, not a yacht), i can buy it. I want to say upfront we are definitely not snobby - we have a really mixed group of friends so the kids know not everyone lives the same way but also they don’t really care, their mates are people who they like hanging out with, not who has the best trainers or poshest house or whatever.

Other bit of context is i grew up quite poor. We never had new clothes or nice things or holidays and I felt this keenly as a child, not least that I was horribly bullied for never having the right stuff. It made me very ambitious and I’ve worked really hard and have a successful career. So growing up I never had any money but I will say my parents were always very generous with what they had.

Husband raised much more wealthy, private school, nice cars etc. but he was raised with constant stress about money, constantly discussing it. Even now he’s sometimes thrifty to the point of it being ridiculous, eg: spending 2 hours on local buses getting back from a kids’ party with eldest son to avoid getting a £6 uber (which we can easily afford).

Anyway at this stage in life I just want to enjoy the fruits of my labour. I want to go to amazing places with my kids, i want to go to nice restaurants and i want to share this with my friends. I like to treat people to share my good luck (often pay for dinner when out etc).

But I’m not sure this is a great example for my kids. Like, they don’t have a clue about money. Regularly on a weeknight they might just ask to go to a restaurant for dinner or get deliveroo. Or when out they will ask for drinks and snacks - they aren’t bad kids, they don’t throw tantrums, but if I say no usually i’d say something like ‘it’s not healthy to have too many snacks’ because if i said ‘it’s too much money’ they’d just be so confused as they don’t understand budgets. And also they know that of course I could afford another juice or snack so why am I saying it’s too expensive?

On the one hand I want them to enjoy our life (that I worked hard for!). I want to teach them the value of being generous and kind, and not stressing about money like my husband does. I want them to understand money doesn’t bring happiness.

But I’m not sure at what age they need to start getting it. I tried giving them pocket money but it burned a hole in their pockets and they rushed out to spend it all on sweets and things as soon as they got it so they didn’t really learn anything from that. They aren’t hugely materialistic kids - both mainly just want to be climbing trees outside so it’s not like they are begging for a certain toy or anything I can get them to save up for.

I’m not worried they are going to be stuck-up as actually them not ‘seeing’ money means they don’t look at the world through that lens. Their mates are just their mates. But I do worry they need to understand the value of budgeting?

I think you’ve left it far too late! My 6 year old has learned how to budget-she has her own debit card to buy things she sees and she gets pocket money for doing some basic chores. If she wants things that are more than what she gets per month she has to wait. I’ve explained money since she first started to play shops as a toddler.

I don’t talk about money all the time obviously but I do say if things are too much money because we need other things or not good value eg DD is learning about comparing prices of things and choosing best value (not necessarily the cheapest). She is starting to understand the difference between essentials and luxuries.

I’m not poor but as a working single parent I do live to a budget, but DD will inherit substantially as the only grandchild on both sides so it will matter that she understands money.

Mine got pocket money from a young age (now age 22 and 19). They arent big spenders though. They got a bank account with debit card at age 11 as thats the age they can have a free bank account with most high street banks. I wouldnt pay for those cards you get from younger than 11.

Talk about the costs of things and how to make choices based on price comparisons. I remember one of mine saying to me as a young child 'you like things on special offer dont you mum?' And thats because i do!

I would start by giving them pocket money. This is to buy any extras they want for the week/month.
my children had weekly money, and were given a monthly clothing allowance from the age of about 5. This was for extras, not the needed coats shoes jeans etc, but for that top she will die if she doesn’t have or the extra brilliant football boots ( I would pay for good ones but if he wanted to upgrade he could add too it ). We also had a weekly play fund, this was a family held account. Well just a sum and I paid for stuff. This covered takeout snacks pictures etc once this was spent it was spent, didn’t do this for long only about 5 years, but it did stop the constant whining for treats.

as they got older (10ish) I introduced the weekly dinner idea. Each child had to plan a meal, cost it (to a budget- no not down the odd onion or spices etc ) then give me the list the day before shopping day. They would then be responsible for Cooking the meal (with me or dad) and clearing up after. They loved doing this activity best and still talk about it my son has introduced this into his family and my GC enjoy it too. Mind you we did get fed up with my middle son always doing toad in the hole, he had it down to a pat, and yes it was good, but not every Thursday 😂

There are free accounts now for kids younger than 11, I pay nothing for DD’s, I have a Monzo one which is very good because her Dad can also manage it (we co-parent) so she can use it with either of us. No charges, you just need an adult account (also free).

I agree, having their own money and actually using it for buying things and saving for bigger purchases.
DS is 17 he has had his own bank account debit card and savings account since he was 11.
He gets pocket money weekly (unfortunately he doesn't have a job, it's very difficult for under 18s here). He pays for meals out or cinema with his friends, gym membership, travel, etc. He saves something every week and he has a "savings week" once a month, where he tries not to spend much, which was his idea.
We are comfortably off (not public school level) as are all his friends but I think he's got quite a balanced idea about money.

DS was in the same position as you. If the DC wanted anything, it was ordered from amazon. If they wanted a new Cd they just ordered it. I pointed out that when they went to uni they wouldn’t have a clue and he introduced pocket money with which they had to buy anything they wanted. They were all given one of the special children’s credit cards too. They rapidly learnt the value of money and how to budget and how to decide what they really wanted/ needed. It’s lovely to be in the position where you don’t have to worry about money but you are doing your children no favours.

My DNephew 7 gets pocket money which he saves and spends on toys. However he doesn’t really know the value of money eg if we go out, nor would I really expect him to. I think he knows not to ask for too many extras from his parents. He wanted a Nintendo switch (his parents wouldn’t allow it) and I could buy it but don’t want to overrule them so I’ve just said it’s too expensive.

I’m in a fairly similar boat in terms of affording things. DS has had pocket money and a kids Monzo account since he turned 6, and yes it burns a hole in his pocket and yes, he spends it largely on toys, but it’s how he learns. He’s now had several ‘oh I want that, but I can’t afford it - if I didn’t spend all my money I could have bought it now’ moments and that does seem to slow down how quickly he spends it!

FWIW I didn’t have any access to money as a kid at all (not a parenting flaw as such, we just didn’t even have money for necessities!) and when I first got a job at 16 I made ALLLLLL the impulsive, reckless spending decisions DS is now making at 6, until I learnt a bit more financial responsibility when I couldn’t afford rent. I’d much rather he goes through the ‘burning a hole in my pocket’ phase now than when it actually matters 😬

Definitely pocket money. If they spend it all, that's fine, there's no more till next time. Dont try to micro manage what they do with it. If they ask for sweets or a toy, say 'yes, if you've got the money to pay for it'. It really helps them decide if they actually want something. I started clothing allowance when they were teens. My youngest DD (16)has a takeaway budget because she'd always be asking for takeaway when rest of family dont really want it, so now she has £10 per week ( we were pretty much spending this anyway). She hardly ever gets a mcflurry in McDs now, whereas when we were paying she'd always be pushing for more

Definitely pocket money. We didn't link it to chores us but we used it as a education instrument basically, so DD got it weekly and she had to use it for things she wanted but we didn't seem necessary.

That ment spending money for holidays, she had to save for toys if she really was desperate for another Barbie. She bought sweets because she just wanted something else instead of what we had at home.

The amount grew by age and from secondary school onwards we moved to a monthly amount because she had a better understanding how to budget. She also got a bit more so she had to pay for cinema or coffee shops when she was out with friends.There was a separate account for savings when she got money for her birthday or Christmas and she also started moving money from one pot to the other.

At 6th form she got an allowance which included also lunches, clothing apart from big tickets like coats and boots. She is now at uni and is budgeting perfectly well she has savings so in case anything happens and she needs a new pair of shoes or wants to buy something big. She just has to budget it in and goes to her savings of necessary.

First you could tell snd show then that there are many reasons for doing or not doing something, apart from money.
Second, you can explain that part of the reason you are well off is that you know how to manage money. Give them an allowance to cover a mixture of essentials and non essentials (eg snacks when out and school stationery) and help them stick to it. Get them interested in budgeting. Maybe ask them to try planning and budgeting for your next holiday.

Similar though we chose not to send to private school, though we could have.

Pocket money was given for chores, no chores no money. It was 20 pence to unload the dishwasher, youngest is 24 now. So my main goal was to teach you get money for your labour.

DH also was a child that had everything, I wasn’t. I explicitly said the children were not to have their every whim catered to and be spoilt. I came home once and DH had bought a roboraptor for DS as he wanted one, they were £100 and this would have been about 15 years ago. DS was at school, I insisted it was put away for Christmas. DH was flummoxed but spoiling kids and giving them everything easily is a bad idea. He had the toy for Christmas, he loved it, around 3 years later when he had enough of it he sold it to my friend for her nephew for £20.

DS got a paper round at 13 He did it till 16 when the paper stopped existing, it was a small local one, then worked as a kitchen porter. We both taught him about savings and investing. His GF is from a very wealthy family, landowners plus a big very successful family company. She is at indoor swimming pool, multiple horses owned level. She worked in the family firm as a youngster alongside studying. All the children have to do this, made her an absolute grafter. She takes nothing for granted.

We probably are slightly less well off but I feel you.

But I’m not sure this is a great example for my kids.

I share these fears and think its valid.
Go to somewhere like beaconsfield and look at the feckless wastrels being inadvertently raised there.

I have started with my dd already at 4
We talk about waiting for toys in case you change your mind.
saving for toys. Buying them second hand.

She does not get given things immediately so i listen to a midlevel amount of whining but I do it because I believe you have to set values early.

We do spend half, save half so she cannot spend or save all her money.
Crude but my parents did it with me and it worked.
I'm not cheap im pretty generous but im also taking care of business first.

She also gets pocket money (£2 pw)

Pocket money from age 6. Learned how to save for things and could earn extra doing jobs round the house that weren't part of normally daily jobs. He had an Osper card from about 9 and then at 16 got a part time job and put money away for university. He's always been really good with money which set him well for living away from home.

We are not as well off as you are but have more than enough, we can afford nice long haul holidays, can pay for a new boiler, new roof....

My teens have pocket money. When my DD was 11/12 the money was gone within a week. One trip to a shopping centre and she spent it all. After the money was gone she would not get any more. So if she went to shops again she had nothing to spend. Same with lunch money (I only give money for 1x lunch a week). We have a lot of food for packed lunches at home. It was hard for me at the time as I felt a bit guilty but It worked great as she is now able to manage money very well, she is 15. She is now able to save some of her pocket money and buys things that's she actually wants and is not an mpulsive buyer as she used to be buying stuff that she would never use/wear.

My DS is 14 is a saver, he doesn't want anything, apart from occasional sweets. They are both so different.

But I got a lot of negative opinions from my work colleagues as they thought I am too tight.

THIS is a really good idea. They like cooking and something practical with a budget is a great idea.

I could tell them the reason we are well off is because I managed money though it would be a lie 😂

The reality is, like many people (most won't admit it), I have a job which pays well, got super-lucky on property and a few other bits and bobs I bought over the years for a laugh and turned to gold out of pure, pure luck.

I have definitely worked very, very hard. But I was lucky that certain economic conditions prevailed and it paid off. But there's never been a financial plan. Oops. And I think my kids can see I don't really think that way and it rubs off. It's hard to teach skills I myself have never really had.

The idea of a budget for snacks and treats on a day out though, is genius. I could say if you want cokes or popcorn or whatever, fine, but it's £5 each and we're done. Not just give them the £5 to spend, more of a budget for certain things.

Tricky though. I did try with the pocket money but they just blew it. The idea of saving for things they want just doesn't really apply as they aren't massively into toys or anything, and don't care about clothes (yet) so there's no incentive. And we don't really tend to go to the shops as a family? Monday-friday is all school stuff, weekends are generally out in the outdoors or at sports. We buy everything online so they'd have to seek out stuff to actually buy if that makes sense.

Well, give yourself some credit and consider many celebrities go from being multi millionaires to dying penniless because of their feckless ways! With or without a plan, you have been budgeting well enough to build assets and manage them.

There are loads of free resources out there to help teach kids about money www.moneyheroes.org has free parent accounts, Barclays life skills and I think some stuff on Natwest. The recent Curriculum Assessment Review put financial education on the curriculum for primary schools (autumn 2027 start). Some schools already do teach it but it will be mandatory soon.

Do you explain to them though that different jobs attract different pay and that means you can have different things?

My DD at 6 knows that a doctor earns more than a nurse but you need to work harder at school and go to university for longer to be a doctor. Same as she knows that mummy earns more than daddy because they do different sorts of jobs and that means we have different things.

I’m the relatively poor person (when I say poor, I mean still in top 20% earnings) in an affluent rural area. Her friend and our neighbour has an enormous house with their horses at home, and the dad has a helicopter that lands in the garden and a tennis court. Whereas my horse was on livery at a farm and the garden certainly isn’t big enough for much more than swingball and a trampoline. My DD understands that they have more money than we do and in basic terms, why.

We don’t go shopping in person much either but DD will ask for something her friends have eg a book or toy and we talk about whether we should get it new or 2nd hand (I buy a lot of used books for her as she is a huge reader and it makes environmental sense to me with books especially). So we will look online and I’ll say for example- you can have all the xx series for £11 secondhand or only 2 books new. What do you think is best?” and she always goes for the used ones and she knows that £10 is her pocket money so £11 is more and she will need to save to have enough.

She also understands that we give her old things to charity shops or buy for the food bank so children with less money than us can still have nice things.

They are still young to get the idea of long term saving. I'd set the level of pocket money with the view that they will spend it on sweets (but once it's gone, they know it is gone, and they don't get any more sweets). However, it's just been Mothers' Day. Maybe you could have encouraged them to save a small amount of their sweets money for 3 or 4 weeks and buy you a bar of your favourite chocolate?

In terms of understanding the value of money, I was brought up in a household where there were huge fights over money and I am like your DH and would spend 2 hours on buses to avoid paying more on travel.

I think the key message is that you are fortunate to have more money than a lot of people, so you have more options, but money is still limited, so you consider where you want to spend it. Sometimes it's worth paying for something that offers more - either in quality, or time, or terms of experience.

You need to go through the phase of giving them pocket money, it burning a hole in their pocket, and them spending it on absolute crap.
The earlier the better. This is an important learning experience.
You mustn't try and stop them or tell them what they can and can't buy. This is why doing it earlier with low amounts of pocket money is better!

Once they get that out of their system they might start to think about saving and budgeting. But I think they need to go through that phase first - and you don't want them to be doing it as teens / adults.

It did work well, and my GC are doing well with it too.

one other thing I always did was encourage them to save for presents. Whatever they saved I doubled, so if they had £5 for daddy’s birthday they got 10 to spend. I felt this taught them the pleasure of giving gifts and knowing that siblings had saved towards theirs