Financial education became a compulsory part of the secondary-school curriculum in England in 2014 – however, some pupils are still missing out, particularly in primary schools.
According to research from the University of Cambridge, commissioned by the Money Advice Service, by the age of seven children have developed their attitudes and values towards money – and these are likely to stay with them for life.
Between 2 and 4 years old children are able to understand and distinguish counting words, while around 4 and 5 years old they get the idea that the items people want need to be paid for and aren’t free. At 5-6 years old children understand certain amounts (of money) do not carry enough ‘value’ in order to pay for some items, and by the age of 7 financial behaviours are said to be fully developed. So it’s not hard to see that it’s increasingly important to help children better understand the value of money at the earliest opportunity.
Experian research has found that 85% of British children that receive pocket money don’t always have to earn it. *
Sarah Willingham, consumer champion, mum of four and BBC Dragon told us: “Pocket money is often the first experience children have of managing money, and I’d like us, as parents, to take a more active role in teaching our kids the importance of earning their pocket money and saving for the things they’d like. “Good financial sense is an essential life skill in the same way as learning to swim or ride a bike. If kids take an active role in family life and are encouraged to take part in activities to earn their pocket money rewards, they’ll not only build up their financial savvy but also their self-confidence and a brilliant feeling of achievement.
Experian's research also found that most (58%) parents are trying to take an active role teaching their children how to manage money well. However, for many parents, issues such as a lack of time, a lack of confidence, knowledge or suitable resources are factors that are holding them back.
When deciding how much pocket money to give, 47% of parents based it on how much they could afford, a further 29% based on the child’s age, and 26% based on their child’s financial need. One in ten (10%) parents give pocket money as and when the child asks for it.
"There are all sorts of ways kids can earn their pocket money, from washing the car to walking dogs – whatever works for you as a family. But the point is that pocket money should be earned not expected.” Sarah adds.
Looking to the future, 37% of parents are concerned about their child’s ability to manage their money when they become financially independent.
Recognising the importance of helping children learn essential money management skills early in life, Experian and Sarah Willingham have partnered to develop Jangle, a free iPad app which has been quality marked by pfeg (part of Young Enterprise).
Sarah continues: “It’s clear that kids’ attitudes towards money are shaped at a much younger age than we think, so we need to start the process of talking about money at home as early as possible.”
Jangle is a great new and free iPad app for children aged 7-11, that teaches children money skills in a fun and easy way while helping them save for the things they want. You can find out more about Jangle here.
*Research was carried by ComRes who interviewed 1,533 British parents of children aged between 5-18 online between the 19th and 23rd of January 2016.