How you can help your teenagers learn about money

Part of being a parent is setting your child up for adult life, but if there’s one area that we’re often guilty of overlooking, it’s money.

No matter how old you are, it can be something of a taboo subject and something we feel awkward bringing up.

So it’s no wonder that many young people find the idea of making their own financial decisions in adulthood a bit daunting.

In fact, research by Moneyfarm has found that more than one in three teenagers (36%) don’t feel confident about handling their finances in the future.

So what can parents do to make sure their teens start adult life feeling confident and empowered?

Encourage them to manage their own money

The Moneyfarm study found that more than half (58%) of teenagers don’t understand financial budgeting, and over two-fifths (43%) don’t know how to save their money.

But money isn’t necessarily an unknown concept to people at this age.

They might get earnings from a Saturday job perhaps, pocket money every week, or cash for their birthday from their grandparents.

So why not use that as an opportunity to help them get to grips with notions like budgeting and saving?

For example, you could encourage them to set savings goals and learn the difference between impulse spending and saving for something they really want.

Talk about money at home

Being open about money and financial matters in front of the kids can also be important.

That doesn’t mean sitting them down for a serious, formal conversation.

Just discussing why you make the financial decisions you make, such as why you’re putting money into a pension, or why you’re buying cheaper options in the supermarket, can help them get to grips with financial concepts and understand how they apply in the real world.

As Chris Rudden of Moneyfarm says: “The aim isn’t to turn teenagers into investment experts. 

“It’s to send them into adulthood with a healthy relationship with money, an understanding of the value of planning ahead, and the confidence to make informed decisions for their future.”

Des’s story

We’ve seen firsthand the value of financial education, often from people who wish they’d learned more about money when they were younger.

Des, for example, was overwhelmed by £25,000 of debt when he came to Money Wellness for help.

Today, his finances are back on track - but he believes his problems could have been avoided entirely if he’d received proper financial education.

One of Des’ debts was a business loan he’d been tricked into taking out as part of a Ponzi scheme, and he thinks that if he’d been taught more about money earlier on, he would never have fallen for it.

Des said: “When I look back on it, some of the struggles I had, especially when I married early and had kids, I didn’t know what half of the stuff meant, like mortgages… It should be taught - it’s the main thing in life.”

Could learning about money have made a difference to you?

Des is one of many who wishes they’d taught about money earlier on in life.

When we did a poll of people we support, more than nine in ten (94%) said they didn’t get any financial education when they were younger.

But significantly, eight in ten (80%) told us they think it would have made a difference to their situation.

And when asked what particular topics would have helped them manage their money better, more than three-quarters (77%) said budgeting, followed by understanding credit and debt (68%) and how to save (62%).

That suggests that at least some of the financial difficulties people come up against in life are avoidable, and that things could often have been different had they been equipped with the knowledge and confidence to make the right choices.

Financial education will become compulsory for all primary and school pupils in England from September 2028, and that’s a real step forward. 

But giving kids the chance to see how money works outside the classroom could also be really valuable.

Help is available for you

An understanding of money isn’t just something that’s nice to have - it’s an essential life skill.

So if you’re struggling with your day-to-day finances, it’s always worth reaching out and asking for help.

We can help you:

• create a household budget
• deal with your debts
• find out what benefits you can claim