Should Children be taught about Money from a Young Age?
From a young age, many parents try to teach their kids the value of money by offering them the chance to earn some by doing chores. Known as pocket money, children often complete tasks around the house – such as making their beds, keeping their bedrooms tidy or washing their parents’ cars – in order to earn a small amount of cash.
Pocket money: pros and cons
Once they have been rewarded for completing their jobs, children can choose what they’d like to do with that money. According to a recent survey, 15% of parents stated that their children put their pocket money into savings each month. By allowing their kids to earn a few pounds every week, some argue that parents are preparing them for the real-world experience and encouraging responsible spending and saving habits that they can then implement into their adult lives.
Others, however, believe that some parents offer the incentive of pocket money for the wrong reasons. 45% of parents that took part in the study admitted to offering the reward to their children to motivate them to do well in school. This is criticised by many, as this approach could make children feel under more pressure to perform, which in turn could lead to stress.
Advances in technology
Advances in technology have also led to children being in control of financial transactions. Games such as Candy Crush and Angry Birds are not only extremely popular amongst kids, but they also offer in-app purchases, meaning that little ones can easily spend money on smartphones – without even really realising that they are doing it. Parents need to be aware of just how easy it can be for their children to accrue some debt through these platforms, so it’s more important now than ever that children understand what they are doing when it comes to potentially parting with a lot of cash.
According to research carried out by the University of Cambridge, children as young as seven understand basic concepts related to finance. However, some children might not ever get the chance to learn about money management from their parents. Low-income families, for example, may find it tough to talk about finances and might not want to highlight the realities of financial distress.
Education
Financial education can make such a difference to children’s lives, and there’s a lot of debate surrounding why it is necessary for children to be taught about financial matters within the classroom. Some argue that children should be taught more about topics such as tax, borrowing money from trusted lenders, mortgages and savings accounts from their teachers, while others believe this information should only be shared at home.
How do you educate your children on the topics of finances?
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