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MONEY MATTERS
January is a time when many of us will be focusing on our finances. Perhaps you are feeling the effects
of an overspend at Christmas or trying to save up for summer holidays. Whether you are setting budgets, evaluating investments or planning a spending spree – good financial discipline is a valuable skill for all adults. However, the foundations are laid at an early age.
So we asked Chartered Financial Planner and local parent, Gavin Porritt, for his advice on how to make money something that you can talk to children about. You can find out more about Gavin at
www.holbornfinancial.co.uk.
Start early Money means different things to all of us, you might find it fascinating, alternatively you might prefer to watch paint dry than have a conversation about your personal finances. Whether you are a saver or spender, may be determined at a very early age. Research shows that children’s financial habits can be formed as early as seven years old, so it is never too young to talk about money with children.
While most advances in technology are a good thing, the switch to a cashless society is not necessarily positive for our bank accounts. Studies have shown that when we spend physical cash our brains register a small amount of pain as we part with it, this acts as a brake on our spending. When spending using cards, or indeed online, the brakes are off.
Money plays a huge part in our lives, so the earlier you can provide your children with a sound grounding the better. Simple things such as counting coins into a piggy bank or playing shop with little ones is a gentle way to get them thinking about spending or saving.
Real life shopping can be a great way to introduce them to the
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concepts of saving, budgets and value. Make a list before you go, discuss why different brands cost different amounts, check the arithmetic on multi-buys and discuss coupons if you are using those.
The novelty of helping out with the weekly shop may wear off. However, as they approach secondary school age you are probably getting dragged into conversations about mobile phones and other gadgets.
Discuss the merits of Pay As You Go versus Fixed-Term Contracts. What happens if the phone gets lost or broken? Is it worth paying for insurance or screen protectors? Introducing these concepts now will mean cost/benefit discussions
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