Young­sters reap re­wards from learn­ing how to han­dle money

Western Mail - - BUSINESS IN WALES - Sion Barry Busi­ness Edi­tor sion.barry@waleson­

TALK­ING to chil­dren about money and giv­ing them ex­pe­ri­ence of mak­ing money de­ci­sions could be just as im­por­tant as sav­ing for their fu­ture, ac­cord­ing to new re­search from the Money Ad­vice Ser­vice.

And the re­port show a wor­ry­ing lack of money skills among chil­dren and young peo­ple in Wales.

But it found that chil­dren whose par­ents in­volved them in de­ci­sions and dis­cus­sions about money, and al­lowed them to ex­pe­ri­ence us­ing money from as young as four, are more likely to de­velop vi­tal fi­nan­cial skills.

These skills can have a ma­jor pos­i­tive im­pact on their abil­ity to save, bud­get and plan ahead fi­nan­cially in later life.

How­ever, chil­dren who aren’t in­cluded in these dis­cus­sions, or don’t get ex­pe­ri­ence of us­ing money, risk be­ing left be­hind.

While the re­search highlights the im­por­tance of man­ag­ing money dur­ing child­hood, early find­ings in­di­cate that many 16 to 17-year-olds are ill-pre­pared for deal­ing with adult fi­nan­cial re­spon­si­bil­i­ties.

Some 28% of those with a bank ac­count say they haven’t had ex­pe­ri­ence of putting money into one, with 28% not even hav­ing a bank ac­count and just over half not know­ing how to read a pay slip prop­erly.

Half of par­ents in Wales think that habits be­come es­tab­lished at age 12 or later. This is in con­trast to pre­vi­ous Money Ad­vice Ser­vice re­search which showed that by the age of seven, chil­dren are able to self- reg­u­late their be­hav­iour, and by the time they are eight, they have a good enough con­cept of the fu­ture to be­gin to build a sav­ings habit.

When it comes to sav­ing money, only 12% of eight to 17-year-olds save money ev­ery time they get money, while 31% save most times they get money. More­over, 50% save some­times and 7% never save at all.

The re­port shows that there is still an op­por­tu­nity to in­crease lev­els of fi­nan­cial ed­u­ca­tion in the class­room. Cur­rently only 35% of chil­dren sur­veyed in Wales aged seven to 17 say they have learnt about money man­age­ment at school and 7% have talked to their teach­ers about money.

Pos­i­tively, nine out of 10 young peo­ple who had learnt about money man­age­ment at school said they had found it use­ful.

And three in four chil­dren talk to their par­ents about money, with seven out of 10 par­ents be­liev­ing that they are a good fi­nan­cial role model for their chil­dren.

Lee Phillips, Wales man­ager for the Money Ad­vice Ser­vice, said: “There are many ways that par­ents can start to en­cour­age their chil­dren to in­ter­act with money from a young age.

“We know that chil­dren learn best when they gain prac­ti­cal ex­pe­ri­ence with money, and al­low­ing them to make de­ci­sions and learn from their mis­takes lays the foun­da­tions for bet­ter money man­age­ment skills as they grow up.”

Money Ad­vice Ser­vice’s re­port has been launched in part­ner­ship with Prin­ci­pal­ity Build­ing So­ci­ety, which is teach­ing more than 40 classes in 29 schools in Wales to pro­vide fi­nan­cial ed­u­ca­tion lessons to more than 1,000 chil­dren.

Its chief cus­tomer of­fi­cer, JulieAnn Haines, said: “Prin­ci­pal­ity is com­mit­ted to help­ing im­prove the fi­nan­cial skills of young peo­ple and this year has been a re­mark­able one, with more col­leagues than ever get­ting in­volved, demon­strat­ing all the val­ues which the so­ci­ety stands for.

“In the past year more than 3,000 school­child­ren have ben­e­fited from fi­nan­cial ed­u­ca­tion classes Prin­ci­pal­ity col­leagues have par­tic­i­pated in.

“Our schools do a great job of ed­u­cat­ing our young peo­ple and to pre­pare them for life, but it is also vi­tal that pri­vate sec­tor or­gan­i­sa­tions with ex­per­tise pro­vide ad­di­tional sup­port and help the com­mu­ni­ties they serve.”

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