When it comes to learning about personal finance, there’s no age limit. In U.K. children are celebrating My Money Week by learning how to manage their personal wealth through free educational resources provided by Young Money, a personal finance education group.
U.K. Celebrates My Money Week
My Money Week, which is celebrating its 10th anniversary this week, is helping children around the U.K. learn about personal finance by giving free resource material to schools.
Both primary and secondary school pupils will learn about the importance of money through different levels of course books. While primary school will teach their kids about making and saving money, students from secondary schools will look at more advanced topics of personal finance such as insurance and risk.
My Money Week is a great initiative to start teaching brits about the importance of money from an early age. It was launched shortly after Moneywise held a nation-wide Personal Finance Teacher of the Year Competition to award schools and educators who are giving their children real finance education that is often skipped from course books.
The initiative includes a number of free digital resources as well as other classroom activities and lesson plans that help children understand the concept of saving and investing money without making it sound too boring. Although many children will be learning about personal finance this week, the crucial subject is often overlooked in the national curriculum.
Why Children Must Learn Personal Finance
Nan Morrison, the CEO of Council for Economics admired the effort made by Moneywise in encouraging financial literacy around U.K. and building students’ knowledge on subjects of finance and economics from an early age. This way children will be able to apply the lessons learned inside the classroom to practical situations once they grow up.
Morrison says that such educational steps should be taken in the U.S. as well where finance and economics courses are taking a backseat in school curricula. A survey from the Center of Excellence in Education found that there has been a significant decrease in the number of states that require students to be tested in an area of economics. The number of states requiring should to test students on concepts of personal finance has also been cut by half.
Lack of financial knowledge is more common in developed countries than you would expect, where most adults not familiar with the concepts of mortgages, credit card terms and payday loans. Targeting young children in schools and teaching them how to generate and manage wealth from an early age could be the best way to break the cycle of illiteracy.
Tips for Teaching Children Personal Finance
Savings expert, Rose St Louis, says that it is never too early to get your kids into the habit of saving. Even the little bit of pocket money that they get can be put in an Isa to let the magic of compound interest turn the small sum into a fortune one day. Here are a few things you can teach your children to help them understand the value of money.
Budgeting: This is a great practice to adopt at an early stage in life that encourages children to analyze their spending habits and allocate their funds efficiently. This could be taught at a very basic level by simply taking children to the grocery store and allocating them a set budget for shopping.
Using Credit Responsibly: With so many credit options on the market, credit card borrowing has reached an all-time high. A financially sound individual understands that spending money that you don’t really have isn’t the best idea. Children can learn about interest rates from an early age through basic lessons such as lending them a set amount of money on an agreed interest rate that needs to be paid at the end of each month.
Working for Money: Money doesn’t fall from the skies, and children need to learn its value from an early age. One simple way that parents can teach their children the importance of hard work in making a living is by assigning them house chores for some extra pocket money. Earning more money at an early age will give the children additional responsibility of managing and saving their wealth.