Fun investment opportunities for children
Saving and investing on behalf of your children is only half of the story.To really ensure that your children benefit throughout their lives, you need to help them develop a love of managing their finances and investing their own money.
And they'd better get used to it soon - financial education is finally set to be included in the National Curriculum in secondary schools from September 2014, taught to children aged 11 and over, across both maths and citizenship lessons.
So here are a few Moneywise ideas to get you started:
Make learning about saving fun by encouraging your children to play with this smartphone and tablet app from NatWest. Designed by Aardman Animations, the people behind Wallace and Gromit, the free-to-download and play app enables players to set up and run their own fair stall.
Every five minutes the player is taken to the Pigby Bank to deposit money, and children who do well can unlock new stalls and play more games.
The app is available on the App Store and Google Play or through the NatWest website (personal.natwest.com/personal/savings/first-saver/pigby-s-fair.html), and parents can be reassured there is no in-app purchasing or requirement to open a NatWest account involved.
This is a kind of online piggy bank that gives children their own personalised dashboard where they can keep track of their pocket money. They can then choose whether to use their "wallet" to get things they want to buy, or their "safe" to put some money aside
for the future. The more they save, the more they get rewarded.
It's initially free to join Roosterbank and set up a basic family account. This allows you to create a regular weekly pocket money amount for your kids (you can add up to six children to your account) or you can upgrade to the Family Premium Membership, which offers additional features including an iPhone app. Premium membership costs from £1.75 a month.
Online accounts may pay more interest but saving is more fun if you can actively take part in it.Taking your money to the bank or building society, watching the paying-in book being updated and meeting the cashiers is all part of the experience.
According to Moneyfacts, the best paying children's passbook accounts are Halifax Young Saver, which pays 3% gross, and Skipton Building Society's Leap Issue 2, which pays 2.75%.
GoHenry is a site for children aged between eight and 18 that gives them the chance to try out their skills in the real world but under the guidance of parents, who can set tight controls on spending limits through a linked account. Children get a prepaid card but parents then decide how much, how often, and where their children spend – with no ability to get overdrawn.
"I have found this an excellent way to talk to my 10-year-old daughter about money, and I feel she is much more knowledgeable than when we started," says Nadine, a mother of two from Yorkshire.
Fantasy share portfolio
Introduce your children to the stockmarket by helping them to build and follow their own pretend portfolio of shares. Keep it relevant by encouraging them to select shares in companies they may know, such as Thorntons or other shops they visit - Tesco or Sainsbury's spring to mind. If they are keen on sport, they could include a football club such as Celtic, which is listed on the main market.
Keep it simple by following a small number - say, five companies - and keep an eye on newspapers and TV news for stories that might result in their shares increasing or decreasing in value. Finally, to add an element of competition, you could award a small prize to the person whose portfolio has increased the most, or decreased the least, every month.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.