A study has shown that by the age of seven they can grasp the lessons they need to learn to avoid financial problems in the future
The UK government’s MoneyHelper service highlights a study from the University of Cambridge indicating that children's early experiences with money can significantly influence their future financial behaviors. By age seven, children often comprehend money's value, can delay gratification, and understand decision consequences. Allowing children to make age-appropriate financial decisions helps develop positive money habits, such as planning, impulse control, and emotional regulation.
Experts like Juliette Collier advocate for teaching financial literacy early, suggesting even toddlers be given coins to manage, spending on sweets, for instance, to understand trade-offs. Numerous resources are available to educate young children about money, including online games, podcasts, and board games. Real-life activities, like setting household budgets and discussing hidden costs, encourage practical understanding.
Emphasizing real-world exposure, Dr. Ems Lord from the NRICH maths project underscores teaching money management in context, explaining cashless transactions, value assessments, and deal comparisons. Practical exercises, such as opening a Junior ISA or introducing stock ownership, can demystify investment concepts for kids. Parenting activities like shopping at charity stores offer teachable moments about financial impact, sustainability, and philanthropy. Overall, practical, hands-on experiences combined with guided discussions can foster financially savvy and socially conscious individuals.