Sixth of parents lack confidence in teaching young to manage money, says survey

ONE in six parents do not feel confident about teaching their children how to manage money, a survey has found.

Some 83% of parents believe they should be the main people to pass on money skills to their children, but 16% say they lack the confidence to do it, M&G Investments found.

More than half (55%) of mothers and fathers feel schools have an important role to play in focusing on financial literacy, while 28% of parents also think children should take responsibility for understanding money themselves.

And just over a quarter (27%) of parents surveyed feel that grandparents should also take some responsibility for their grandchildren’s financial education.

Most (60%) grandparents surveyed said they had a role to play in ensuring their grandchildren were savvy with money.

Learning the importance of saving, followed by understanding the value of money and how to budget were seen as the most important money skills for children to pick up before reaching adulthood, the survey of parents and grandparents found.

More than 500 parents and over 360 grandparents took part in the survey.

Ritu Vohora, investments director at M&G Investments, said: “Financial literacy is an absolutely vital life skill.

“Whether that’s how to put together a daily budget or to save, borrow or invest sensibly to achieve longer term goals, it’s critical to prepare young people for adult life by making sure they’re financially savvy.”

Here are some tips from M&G Investments for parents and grandparents to encourage children to learn money skills:

• Encourage children to save pocket money by matching every pound they invest.
• Consider contributing into a Junior Isa, or Jisa for the younger generation.
• Take the time to sit down and discuss money. Grandparents can use their life experience to teach children about the benefits of saving or investing early to achieve life goals, such as putting money aside for a first home.