大象传媒

Huw gave his teenage sons, 14-year-old Hywel and 13-year-old Rupert, a lump sum each to invest.

“My wife and I are very keen to teach our boys about notions of wealth and how to manage their money. We set up a parent investment fund for them. We gave them £300 each, which they were allowed to decide how they would invest that. The only caveat was they had to come up with a proposal for my wife and I to agree, we didn’t just hand over £300.”

The proposal couldn’t just be that they would spend it on sweets, it had to be a genuine plan to grow the money. Hywel moved first, with a plan that wouldn’t be out of place on The Apprentice.

“I bought some tech products, which I then resold online and I made quite a bit of money,” he explains. “I bought drones online.” Hywel invested the full £300 and within six months had made £260 in profit.

“I also spent the profit as well,” he admits. “I like investing and I like spending as well! I bought clothes and stuff for myself.”

Meanwhile, 13-year-old Rupert invested £100 in his brother’s drone business and made plans to invest the rest in currencies. “I think I’m best with money,” he says, pointing out that he hadn’t spent all of his, while his brother had blown some of his profits on a novelty money gun.

Huw likes to think that other parents might try out their own parent investment funds to teach their teens about business and money, but acknowledges it is an expensive experiment. “I just feel it’s really important to learn how to manage money otherwise your money ends up managing you,” he says. “I hope others do follow this. But equally, I am aware how privileged my kids are that we can afford to.”

Fortunately, there are other, cheaper ways for parents to teach those essential money lessons. Beginning with talking to children about cash and budgeting.

“Often kids are more clued up than we would think,” says Stephanie Fitzgerald, the head of young people at The Money Charity.

“We do workshops across the country and get all kinds of fascinating insights from what happens at home, what young people overhear. Even if young people aren’t talked to about money, they pick up things along the way, they hear things on the news and they often have pretty good ideas about what a pension is, we have questions about investing and they are really thirsty for more!”

“What children are most interested in is often different to what teachers and adults think they should be learning about. The most common question we get is about investing and how to get rich. They also often ask how they can not mess things up when they are living independently – they think that it’s scary and they know the stakes are quite high. They don’t want to spend all their money and get trouble.”

It helps to get your kids involved in their savings

Many parents try to save money for their children, sometimes into Junior ISAs for when they turn 18, sometimes into straightforward savings accounts that can be used before then. But, as Money Box Live finds out, it’s a very good idea to encourage youngsters to be involved in managing those savings and watching them grow.

“Giving them control of money in a savings account is a really helpful way for them to learn about money,” explains Sarah Coles, personal finance analyst at Hargreaves Lansdown. “If you keep it in your own hands and give it to them when they need lump sums, they never learn to manage it quite so well.

“Also, savings accounts for children actually do offer some pretty good rates compared to their adult equivalents, so they are a decent home for money that’s going to be needed over the next five years.”

One way to teach good financial habits is with pocket money, for those families who can afford to give it. Figures from NatWest suggest around a third of parents still give traditional pocket money and the going rate is just under £4 a week.

“I get £5 a week,” says 11-year-old Holly, from Rugby in Warwickshire “and my younger brother gets £2. Sometimes I save it. I’m not the best at saving but I can save when I know what I want. I once saved up for a slime kit.”

Stephanie says: “My top tip to parents is that the best thing you can do for your young person is give them pocket money. Giving them that responsibility early on, giving them a chance to make mistakes… Feeling disappointed about mistakes or feeling great when they’ve saved up their money and bought something bigger, and having the chance to experience all that early is really beneficial.”

Computer games can teach good spending habits

Many parents will know that their children often want money to spend within their computer games rather than in the shops, so they can buy characters and costumes for their digital world. Sometimes those items can seem expensive, but could that help parents teach good habits?

“Games create spaces that are more like playgrounds,” says Andy Robertson, founder the website Family Gaming Database, which helps parents navigate their children’s computer games. “And, like in the real world, how they look affects how they feel in those places… It’s important that parents can guide them and say: ‘Well, do you really need this particular item, it’s quite expensive?’

“All the modern consoles have the ability to set up an account for the child when they’re playing and then set limits on that account. You set a low pocket money level and when that money’s gone, it’s gone. Then that’s quite a nice learning cycle.”

You can hear more tips, more family experiences and more from those experts by listening to Money Box Live: Children's Finances.