How not to pass on your financial ineptitude to your children

My nine-year old son (G) earns pocket money by doing chores around the house, like many of his friends. He is pretty nifty with a mop or dustpan, so he racks up the pennies and keeps count in his big green notebook. It’s a tough balance to strike between teaching children about the deeply uncool reality of being broke and not scaring them half to death. But he does need to equip himself with a decent work ethic and some savings savvy, if he’s to sidestep the minefields he’ll inevitably encounter.

Money, for me, is not just a financial issue but a deeply-rooted emotional one. As the only child of a struggling single mum, I became painfully aware at a very early age that there was nothing spare. We rarely had enough for necessities such as rent, food or bus fare, let alone pocket money. My twenties were plagued with student debt, combined with high cost of living and a low salary, making me possibly the least qualified person in the world to pass on pearls of wisdom to my offspring.

Will he still be tapping us for cash when he’s 47?

In my misguided effort to protect G from the anxieties I suffered, I may have unwittingly swung too far in the opposite direction. Am I teaching him to take our reasonably secure situation for granted? Will he spend all his student grant in week one? Will he still be tapping us for cash when he’s 47?

Luckily, there are ways to encourage children to develop healthy habits, from as young as when they first learn to count.

G caught on quickly to the idea of saving for specific toys or treats, and is totally on board with my laughable pursuit of discounts, special offers and sales.

We compare the price of everyday purchases at the supermarket, and he calculates the change.

Encourage your child to make independent financial decisions.

Opening a savings account when he turns 11 will be a fun way to learn more about mobile banking. I like the look of the Children’s Bank Account at Barclays.

I give G his allowance in smaller denominations, so there’s less temptation to spend it all at once. Since G started recording his savings (or ‘earnings’ if you decide to go the child labour route) his motivation grew.

The more independent spending decisions children are able to make, even if they aren’t always good ones, the better.

As allowances might increase with the child’s age, so too can the list of items they’re responsible for, such as their phone credit.

If your child wants to dip into the money they have saved, don’t always say no, as routinely refusing can discourage them from saving altogether.

Tread lightly, and don’t go overboard and create a saving obsession (that’s another post all on its own). Money is like water – it is meant to move.