Money may be a daunting subject for many, but teaching your children simple financial lessons will go a long way to helping them manage their own finances later on.
While financial education was added to the secondary school curriculum back in 2013, younger children in particular still aren't being taught about money.
My Money Week, which runs from 10-16 June, is an attempt to raise awareness of this issue and give teachers access to more resources to help educate their pupils on money matters.
Of course, parents have a vital role to play as well, so let's look at what you can do to help prepare your child for all the joys that await them in adulthood.
Please note this article focuses on children of primary school age. If you have far younger children, these money lessons might be more useful, while those with teens can share these money lessons with them.
The need for more financial education
Research from debt firm Money Advisor found that many children have unrealistic, inflated expectations of what their future earnings will be.
“Educating children about finance can help to avoid much bigger debt problems later in life,” says Andrew Petros, senior financial solutions advisor at Money Advisor.
“We understand that many parents don’t want to burden their children with money worries.
“However, encouraging positive, healthy discussion around saving and spending from a young age can really help to create those long-term habits – as well as teach children other useful values such as patience, responsibility and independence.”
Financial education isn’t compulsory at primary school at the moment, but some schools do teach it.
A parliamentary report in 2016 recommended that all children should learn about money matters from primary level.
The same report warned that financial education was becoming a “postcode lottery”, with some students missing out simply due to the school they attend.
Invest for your child's future: compare Junior ISAs (capital at risk)
Three money lessons for under 11s
If personal finance isn’t taught at your child’s school or you want to take matters into your own hands, here are three key lessons you can teach them.
1. How to count money
“Teach your children to count up different denominations of money, and not only will it give them a real understanding of the value of money, but it’s a sure fire way to boost their maths skills,” says Justin Urquhart Steward, co-founder of investment management firm 7im.
“Counting money is something most young children struggle with – but in my experience, it’s amazing how quickly dangling a carrot like pocket money can really focus the mind.
"So it really helps their understanding of money concepts whilst seriously boosting their maths skills – a win/win!”
2. How to save
Set your child up with a piggy bank or their own savings account and encourage them to set aside a little of their pocket money each week – one way to encourage them is to offer to match what they save.
“With four boys, it has the potential to get expensive, but pound matching is a great way to incentivise your children to save and foster good habits without spoiling them,” says Tom Sheridan, chief executive officer at 7im.
“It also means they should be much more receptive to paying into a pension when the time comes, having had a good grounding in the benefits of matched employer contributions.”
3. Set a family savings goal
You might be saving up for a holiday, a new TV or a family day out but, whatever it is, get the kids involved.
Create a totaliser and get the kids to colour in the different stages as you gradually accrue the money needed.
This will help them learn how rewarding saving can be and that sometimes you have to work for things over time.
Read: why I'm opening a Junior SIPP for my child rather than a Junior ISA
What to read next
If you have a younger child/grandchild, you might find these money lessons more useful. Conversely, if you've a teen under your roof, here are some money lessons to share with them (assuming they don't know everything already, of course).
And finally, here's our in-depth collection of tips for kids of all ages.
Compare Junior ISAs on loveMONEY (capital at risk)