Teaching kids about money works

28 June 2018

Children who have been taught about money at primary school are better able to defer gratification and save up for things they want than children who have not, according to a new study examining the effectiveness of financial education in schools.

Substance, an independent research group, worked with children aged between seven and 11 and found that those who had received financial education were able to understand banking, learn how to budget and forge habits, such as resisting temptation. They were also able to understand that financial decisions made now could have ramifications for the future.

The study took place over one year and included 1,444 children, 187 teachers and 86 schools which were working with the financial education charity MyBnk – whose primary school project is supported by Kickstart Money, an alliance of 20 of the UK’s largest investment firm - as part of the Money Advice Service project.

Schools used videos, manga-style comics, games and role play and covered subjects areas including money, consumer choices, mind sets and prioritisation. This included four hours of expert led face to face sessions plus six hours of teacher lead activities and four hours of home-based activities.

According to the Money Advice Service, behavioural attitudes to money are formed as early as age seven, but despite this there is still no compulsion for primary schools in England to provide lessons in basic money management.

Moneywise is campaigning to improve financial education in schools and earlier this month announced the winners of the Moneywise Personal Finance Teachers of the Year 2018 competition

‘Young children can be taught how to become smart spenders’

After receiving some lessons in money, the research found that:

  • 91% of children can defer gratification, a 68% increase on those that previously would not.
  • 70% of pupils will actively save for something they want.
  • 55% of children that couldn’t previously understand terms, such as ‘habit’ or ‘budget’, now did.
  • 87% of teachers said their pupils understood that financial decisions had consequences.
  • 91% of teachers said children appreciated that there were ‘costs of living’.

James, an 11-year old pupil at Haberdasher Aske's Crayford Temple Grove primary school in London, who received the lessons says: “It's changed me because when I go to the shops with my sister I'm thinking, “why can't I buy things too?”. Now I think, “do I really need this? Can't I use this money and save it for something else more important?”

Commenting on the study, Guy Rigden, chief executive at MyBnk says: “We’re all paying the costs of our inability to talk about and deal with money. Personal debt is increasing, millions of workers are not saving for longer lives and good choices are being missed.

“This study shows categorically that young children can be taught how to become smart spenders and savvy savers, early, setting them up for their future, with the biggest progress made by those that need help most.”

‘Financial education should be put on the primary curriculum’

Jane Goodland, co-chair of KickStart Money, adds: “Based on this success, we reiterate our call that the government should put financial education on the national primary curriculum.

“Politicians may believe that being competent with numbers equates to being good with money. While basic numeracy skills are helpful for budgeting and saving, many of our financial habits are in fact motivated by our attitudes and behaviours learned at a young age, and not by our ability to do complex maths.”


In reply to by anonymous_stub (not verified)

Financial education is a vital need for children and should start in primary schools, teaching them about saving up their pocket money for the things they want. Not only does this give them a better understanding of their personal finances, it helps to develop their self reliance - taking responsibility for their money and the things they buy with it. Not only that but they are more likely to value those things that they have saved for and take care of them.Equally important, however, especially when they are a little older, they need to be taught about public finance. Having some knowledge about income tax, National Insurance, VAT, Council Tax etc will help pave the way towards adult responsibilities and enable them to be better prepared when they need to stand on their own two feet.Whilst many might argue that this is the job of parents (and most could do that), it should not be assumed that youngsters will get all this financial education from parents or other relatives. Indeed, many would be unable to do so. Therefore it needs to be part of the curriculum to equip youngsters with the knowledge they need when entering the adult world.Just in case anyone says teachers don't have the time to do this, I would argue that financial education should take precedence over a few other subjects. What proportion of adults have needed to use simultaneous or quadratic equations in their adult life ? Very few of course, but we ALL need financial education - so let's get priorities right.

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