Parents’ key role in handing children vital lessons for life - Sarah Coles

Last year there was no relief, because we knew ‘back-to-school’ could be swiftly followed by ‘back-to-work-at-home-again’.

This year is different, but we still can’t afford to relax, because the hard work of catching up on all the lost lessons is just starting. And it’s not just the professionals with a role to play.

Don’t get me wrong, parents aren’t in the frame for the core subjects any more. We’re not expected to be amateur experts in everything from poetry to physics.

Instead, while the schools focus on helping students catch up with the subjects they’ll be sitting exams in, they’re likely to have less time to devote to broader life lessons – like money – and that’s where parents and grandparents can make an enormous difference.

There’s every chance that the school will still run through the basics, but for a lot of students, it’s not going to be enough.

After I slogged through the process of how to calculate atomic mass with my son, only for him to claim in the next lesson that he’d never come across it before, I realised that you need to devote real time to something before children retain any of it.

It means we need to support them by teaching them what we know about money. And fortunately, lockdown learning has provided useful insights into the best ways to get the subject to stick.

1. Don’t make it seem like a lesson

If it feels like hard work it’ll put them off from the start, so think about the best time to broach the subject.

Often children find it easier to talk when they’re side-by-side rather than face-to-face, so next time you’re walking together or driving somewhere, you can start a conversation.

They need to be involved to be interested, so make sure it’s a two-way discussion rather than a lecture.

My youngest is officially bored by history lessons, but chatted for half an hour in the car about whether the Gunpowder Plot was actually invented by Protestants.

2. Get them to explain what they already know

This will get them thinking about the topic, and highlight gaps in their knowledge, as well as revealing the things you don’t need to cover.

You’ll be surprised by what they have picked up from you and the world around them – including social media.

You may also be surprised at the things they haven’t picked up, and how that makes them vulnerable.

When I spoke to my eldest about teenagers being used as money mules his response was: “I would totally have fallen for that.”

3. Give them practical learning opportunities

This was something the school encouraged in lockdown – which is why I found a saturated bath mat leaking water all over my son’s bedroom floor one lunchtime (it was a lesson about absorption in the gut apparently).

The same approach, can be effective with financial lessons (without the need for a bath mat), so one of the best ways to teach children about budgeting is to give them pocket money or an allowance and get them to manage it. They’ll make mistakes along the way, but that can be a useful learning experience too.

4. Repeat

There’s a reason why the schools make children do endless sums using the same techniques, and it’s not just so their parents get to hear a constant refrain of “but I’ve already done that”. Repetition is a useful way to get lessons to stick.

The challenge is to find new ways to teach the same things that will keep them entertained.

If you’re trying to explain the basics of share investment, for example, you can get them to look up a company they’re interested in, and see how it has performed over the years. You could start a fantasy investment competition with them, and you can talk to them about what they hold in their JISA.

5. Don’t do it all yourself

This was the most vital lesson I learned during lockdown when I was running on vapours, and decided my husband needed to step in overseeing the lessons I couldn’t face.

Teaching money matters isn’t just a job for parents either. Grandparents have the benefit of a lifetime of experience and knowledge, which they can put to good use.

Getting stuck into lessons in your spare time might feel like a big ask at the moment.

The last year and a half has felt like a particularly tricky juggling act, where just as you master three balls, someone chucks in a fourth, and a fifth, then a glass vase, and a couple of knives.

But while few of us could keep this up for much longer, and we’re all keen to hand over as many of the things we’re juggling as possible, it might be worth hanging on to our new experiences of helping our children with learning.

It could help them make better financial decisions throughout their lives.

A miserable month for savers

Figures from the Bank of England this week revealed we stuck to our savings habits in July.

The £7.1bn we put aside is down from the April-June average of £8.8bn, but it’s above the pre-pandemic average of £4.7bn.

Unfortunately, most of us are getting very little back from the banks in return for our efforts.

In July, the average interest rate on new fixed accounts fell to 0.29 per cent – a historic low – while easy access held steady at 0.1 per cent.

Fortunately, recent weeks have been a bit more promising. Banks jostling for position at the top of the market eased the squeeze for those savers who are prepared to shop around, especially in the fixed rate market.

It has opened up the gap between easy access and fixed rates, so we’re finally seeing more savers seriously consider tying their savings up for a better deal.

However, if you want to take advantage, you’ll need to act fast to get the very best rates. Many of them are from newer, smaller banks, who aren’t looking for enormous sums of cash. It means many of these will be blink-and-you’ll-miss-them deals.

Sarah Coles is a personal finance analyst at Hargreaves Lansdown

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