Good Money Week: Teaching your kids about money could also help improve your finances

1 October 2018

A pilot course designed to help parents teach their children about money has also unexpectedly improved parents’ finances too.

The two-hour Talk, Learn, Do course - run by the Money Advice Service (MAS) - aimed to encourage parents of 3-11 year olds to talk to their children about money and managing it.

According to new analysis of the programme, which was piloted in 2016, parents also saw improvements in their own personal finances after 12 months.

Researchers found that there was a 15% decrease in the number of overindebted parents a year after taking the module.

Parents who had taken part in the session were compared with a control group of parents who had only taken the regular parenting course. 

Researchers believe that the unexpected benefit to parents’ own finances is likely to result from the course encouraging parents to be more open about household spending and debt.

One couple who took part in the session described it as a “reality check” that helped them face up to their growing level of credit card debt, which was in the tens of thousands of pounds.

There was also a 13% increase in parents giving their children pocket money, which is a good way to introduce them into the world of personal finance.

Previous research from the Money Advice Service has shown a strong link between children receiving regular money and better financial habits.

Activities like playing shop at home, talking regularly about money, making shopping lists together and setting family budget goals with children as young as three were found to influence positive money habits that children would carry with them for life.

Overall the project was successful in improving parents’ knowledge on how to talk to their children about money – after 12 months the study found there was a 14% change.

Sarah Porretta, UK financial capability director at the Money Advice Service, says: “The results from the study are really positive. It proves that earlier really is better when it comes to introducing your children to money. 

“It’s also important to remember that you don’t need to be a financial whiz to help them on the path to success. In fact, you can teach children a lot through everyday activities. Get them to help you making shopping lists, or involve them in household budgeting – and don’t think you have to shelter them from conversations about money."

She adds: “Children can start learning about money from as early as the age of three. And a lot of the money habits they will need as adults have already started to develop by the age of seven. But they can also pick up new skills as they get older too, so it’s never too late to help them.”

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