Parents set their New Year’s financial resolutions, with a third* worried they are passing down bad habits to their children
BAD money habits are a concern for parents in the UK, who fear that their children will learn these negative behaviours from them and miss out on their own prosperous future. Almost a third of parents (29%) worry that their kids will be less well off than them when they grow up. It is these worries that are driving a new set of New Year’s resolutions for parents, with greater impact on, and responsibility of, their children’s financial future.
Topping off the list of parents’ bad financial habits are: not putting money aside for a rainy day (19%), overspending (18%), relying on credit cards (15%), spending money impulsively (13%), and not working out a monthly budget (11%).
When it comes to educating their children on money, 13% of parents admit they do not feel equipped with the knowledge to do so, with parents under 35 (18%) feeling the least confident with teaching the skills themselves. To add to this, more than a quarter of parents (26%) say their child’s school simply isn’t doing enough to help.
Almost one third (27%) believe their children’s chances of being comfortably wealthy in later life is dependent on them receiving financial education at an early age, and nearly half (44%) of parents want compulsory finance education at school.
Without the resources, time, and expertise required to teach personal finance acumen, teachers face an uphill battle. The research, which was carried out by leading financial education charity RedSTART, also found 26% of parents agree that teachers lack the right support and knowledge to teach kids the critical money saving habits they need.
Today the charity, which is dedicated to financial education among primary school children, is commencing a long-term study at a north London school. The initiative will monitor and assess children’s attitudes to money before and after financial education training, over the course of a year, to prove that financial education helps to not only develop good habits that they will keep for a lifetime, but boosts pupils’ prowess at maths and Personal, Social and Health Education (PSHE).
The study takes the form of an interactive self-contained micro-economy
at Worcesters Primary School in Enfield, where pupils are earning, saving, and spending pretend currency or “acorns”.
Named by pupils at the school as The Oak Bank, three out-buildings have been converted into a bank, shop and product showroom. As well as the pretend currency, there is also an online banking platform.
The pupils, aged five to 11-years-old, will earn acorns, which they can put into a current or savings account, that earns interest over time.
Over the course of the programme, data from the banking platform will be analysed to see whether students move money from their current account to a savings account after attending RedSTART’s ‘Money Matters’ workshops where they are taught about earning interest, along with many other financial skills.
The initiative has been supported by donations from AXA Investment Managers and Mash Virtual, and RedSTART is confident that the results will be extremely useful in the charity’s drive to prove that financial education for primary school children should be compulsory.