10 September 2015

Give your child a back-to-school finance check-up

If you have a child about to start secondary school you’ll no doubt have plenty of ideas to help them get ready. Along with sports kit, a new route to school and of course a new pencil case, consider adding a check-up of their money matters to your to-do list.​

Your child’s financial world is about to get bigger

Starting secondary school marks a huge change in your child’s life and as they enter this new phase it’s likely that money and finances will become a much more significant part of their lives. New hobbies and interests may require funds to buy kit or pay for lessons, while as they enter their teenage years they may take an interest in fashion and want to choose and buy their own clothes. Plus, as they get older socialising will become more important and they may want cash for doing things with their friends and perhaps a new mobile phone or tablet for keeping in touch.

Your offspring will also be becoming more independent – not least when it comes to money. They may now want to take more control over their finances and start budgeting for things like trips, concerts and new clothes or ‘big’ purchases, as well as spending small amounts week to week on apps, music downloads and phone credit.

It’s important that young people are taught to manage their money from a young age, to get them into good financial habits. We take a closer look at what financial guidance kids get in school and what you can do at home to help them navigate their financial world.

What will they learn in school?

Money matters have long been touched upon in schools, particularly in subjects such as maths, where kids use pounds and pence as units of currency and work on problem solving questions involving money, but now schools are making extra efforts to ensure young people are finance savvy.

The national curriculum includes financial education for pupils in England, Wales, Scotland and Northern Ireland and from the age of 11, youngsters will be taught about personal finance in citizenship lessons, covering topics like budgeting, managing risk, and how to balance spending and income. As they get older (from age 14), citizenship will cover how pensions, insurance and other financial products and services work, along with how public money is spent and where it comes from.

How can you help your children feel confident with money?

You can support what your child is learning in the classroom by putting some of the ideas into practice at home. Here are a few suggestions:

  • Involve them in family budgeting decisions – let them plan how to spend the weekly grocery budget. (You may want to keep a veto over how much junk food goes into the basket!)
  • Chat to them about your own finances, including mortgages, savings accounts and any investments you hold, so they understand the scope of the family finances.
  • Encourage them to do their own research. Sitting down and talking about money with your mum and dad can seem a bit boring, so point your kids in the direction of some great resources and let them do their own research. After all, learning to manage their own money is all about being independent. The MoneyStuff YouTube channel from Nationwide features videos from popular vloggers, giving their insight into money matters.
  • Have them ‘lend’ you some money and calculate the interest together every month, so they can see how it grows. You could use this exercise to explore the idea of compound interest too, if they’re keen. 
  • Encourage them to take on some part-time work. Money you have earned is completely different to money you have been given and kids will truly appreciate the pounds they have worked hard for. Children can actually undertake part-time work from the age of 13 and something like a paper round or helping out with a family business can work well around school and other commitments.
  • Reward them for chores – if you don’t like the idea of your children having jobs, why not put them to work in the house in exchange for their pocket money?
  • Go through their mobile bill with them. Many kids will get their first mobile phone as they start secondary school and they can be a great budgeting tool as well as a means of keeping in contact. Go through your offspring’s bill with them each month so they understand how much they are spending. If they are using a pay as you go phone, why not give them a set amount of credit each month and help them budget it accordingly?
  • Encourage giving to charity. Kids don’t typically have bills to pay, so any money they earn is theirs to spend. Encouraging your children to donate a percentage of their pocket money or earnings to charity gets them used to the idea of having financial commitments.
  • Consider opening a bank account to help get your kids familiar with the features and functions of a current account.

Your child’s first current account

Most banks & building societies will let a child open a current account (that’s designed specifically for children) from 11 years old – perfect timing for the transition to secondary school as your child gains more independence with money . You’ll want them to have something that’s straightforward and easy to use and it’s worth looking into whether there are any fees that apply for transactions too.

It’s also worth considering how the account can be accessed. Internet and mobile banking are becoming increasingly popular so it’s a good idea to get kids used to banking apps and online accounts whilst they’re learning about finance.

The Nationwide FlexOne current account for 11 to 17 year olds, comes with a choice of cash card or debit card and gives kids access to online banking and mobile banking. More about FlexOne.

More about how to choose your child’s first bank account.

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