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Financial education – 6 ways to teach children about money and how to manage it

Six activities to teach kids about saving – from the UK’s best personal finance teachers...

  • Financial education – 6 ways to teach children about money and how to manage it

Learning how to manage money is an invaluable lesson to teach children.

Here, the winners of the Moneywise Personal Finance Teacher of the Year Awards share their ideas to help pupils get to grips with everyday money tasks.

Encourage children to try these activities at home with their families, or adapt them if you want to try them in the classroom.

1 | Discount detective

Nicola Butler, maths and finance teacher, Eirias High, Colwyn Bay

Money skills: Bargain hunting, saving

This challenge is designed to help children shop around and find the best deals. For this activity, set a challenge for your child to complete. For example, this could be finding the best value broadband deal or pet insurance policy.

Encourage your child to note down what the different deals include – for example, the channels included in different TV and broadband deals. This will help distinguish which offers are better value for money, rather than just being the cheapest option.

2 | Create your own bank

Tom Raffield, maths teacher, St David’s School, Purley

Money skills: Banking, currency conversion, saving

Ask your child to identify something that they want – for example, a toy – and set its value as the target. Then encourage your child to save money and log their progress.

Giving them the flexibility to save what they can will help them to work out how long it will take to reach that target.

To take this a step further, create your own household currency. Help your child to name and design the tender, and the conversion rate to pounds sterling.

For example, five ‘star dollars’ could equal £1. This new currency can be used to reward your child for helping around the house, good behaviour and doing well in home school.

At the end of the week, convert what they earn into pounds, which they can then choose to save or spend.

3 | Open a restaurant

Sian Bentley, deputy principal, Queensmead Primary Academy, Leicester

Money skills: Budgeting, saving

Setting up a restaurant is a clever way to help children learn about money.

First, get children to think about their favourite restaurant meal or takeaway and have a look online to calculate how much it would cost the family to order it.

Next, make a list of ingredients needed to help recreate the meal at home and work out how much this would cost. At this stage you can recreate the meal using real ingredients, if possible.

Calculate how much you have saved by cooking, rather than eating out or ordering a takeaway.

4 | Bare necessities challenge

Helen Westwood, financial studies teacher, Caroline Chisholm School, Northampton

Money skills: Money management, saving

Ask your child to write a list of your family’s regular costs, including bills, commuting, food, toiletries, cinema tickets, etc. Review the list and work out what you’re still spending on (bills, food and insurance, for example) and what you’re no longer buying (food from cafes, theatre or cinema tickets).

Discuss whether or not you miss those expenses and how much you are saving. This can help children to understand the difference between essential and non-essential spending.

5 | Pocket money challenge

Helen Westwood, financial studies teacher, Caroline Chisholm School, Northampton

Money skills: Budgeting, saving

Teaching children the importance of having an effective budget can help them develop good money habits as they grow up. Creating a budget for pocket money is a fun and interactive way to learn money management.

Encourage your child to set financial targets – for example, saving for a new bike – and work toward these goals by setting money aside. To help incentivise saving, offer to pay top-ups when your child hits certain milestones.

For example, if they save £20, you may wish to add an extra £10 on top as a reward for saving. This helps develop an understanding of how saving works and the benefits of putting money away. Get creative and use colouring pencils, crayons and other stationery to bring the budget to life.

6 | Great savings race

Agnelo Mendonça, business teacher, Loxford School, London

Money skills: Investing, saving

This challenge can help children focus on savings and develop good money habits. When your child receives income, such as birthday money, encourage them to split it into the following:

  • 50% into long-term savings
  • 30% into short-term savings
  • 20% for an immediate treat

Long-term savings can be held in a savings account or Junior Isa. You and your child can monitor their savings’ progress as time goes on.

Short-term savings are for items they would like, but need to put money away for. The remainder can be used to buy something right away.

Encouraging your child to split their income helps them understand the difference between short-term and long-term savings. Add top-ups or additional rewards to your child’s income if they hit a particular savings target in a set period of time. 

Know a great personal finance teacher?

Nominate them for this year’s Moneywise Personal Finance Teacher of the Year Awards. Winners will receive a share of a £24,000 cash prize pot from Interactive Investor for their school. The awards are open to all qualified UK primary and secondary teachers.

Email nominations to editor@moneywise.co.uk before 3 September 2020. The first 250 teachers to nominate themselves will receive a £50 Amazon voucher.

Find out more at moneywise.co.uk/personal-finance-teacher-of-the-year-awards.

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