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Instilling good money habits

3 Oct 2023 | 2 minutes to read

Raising healthy, happy children who will go onto live a fulfilling life and reach their potential is every parent’s wish.

Just like instilling good values in all other areas of their life, when it comes to money there are some simple things that parents and grandparents can do themselves to banish money taboos and pave the way for their children and grandchildren to build better financial habits.

1. Talk about money 

Make money - earning money, savings plans and tracking your budget - a topic in your home.

2. Bring money to life

It’s not money in itself but what it can provide that’s the important lesson. So if you are saving up for a treat, a trip, a new car/home, show your children the link between the work you’ve done to earn that, the savings journey and then using that money for the fun part.

3. Work, savings and taxes

Even from quite a young age children can have their own experience of ‘work’, ‘earnings’, ‘savings’ and ‘tax’. Agree to pay them for their chores. Deduct set amounts to go into their savings account and ‘taxes’ to come back to you for food, accommodation etc. – you could even produce their own ‘payslip’ to get them used to that.

4. Budgeting and planning

If they want something in particular, agree to set that as a goal, work with them to see what they can save each week/month out of their ‘pay’, see how long it will take to save what’s needed, then regularly track it with them.

5. Introduce more detail as they get older 

Talk about debt, mortgages, compound interest, pensions etc. Use your own workplace benefits as examples.

6. Continue to guide

As with all parental values and lessons, add ‘money’ and make it a continuing journey in line with their age. For example, from setting a first saving goal for a new Lego set to preparing them for financial independence when leaving home and starting their first job.

7. Savings journey

There are some specific savings options and annual tax allowances if you plan to start saving for your children/grandchildren such as Junior ISAs, Junior SIPPs, specific children’s savings accounts etc. Start by saving for them, then bring them into the experience by saving with them - tracking new money added and how those savings grow over time. Establish these good savings examples and they will then be well set up to take on the baton and save for themselves when they are older.

The Money and Pension Service tool Talk Learn Do is a great starting point.



Before you invest, make sure you feel comfortable with the level of risk you take. Investments aim to grow your money, but they might lose it too.