Helping kids to foster an open, balanced relationship with money early in life can have positive consequences for years to come. Whatever age your kids are, there’s an age-appropriate way to start conversations around saving and money management.
In our new series, Ask The Money Mate, we’re speaking to real-life parents of kids and teens to hear their feelings on finances – and we’re putting their dilemmas to our expert, David Coleman.
As a clinical child and family psychologist, plus the author of three books about parenting, David can offer practical, accessible advice, helping kids and parents to start honest conversations about money.
Next up in our series: Father-of-three, Alan Dooley. He’s based in Limerick with his wife and three kids: Adam (15), Jed (13) and Brynn (8).
“We don’t really do pocket money any more. We tried it but felt the kids just saw it as ‘free money’ and had a lack of appreciation for what it really meant,” says Alan.
“We’ll give money as and when it’s needed, but we do make sure the kids ‘earn’ it by doing jobs around the house. We try to have fairly consistent messaging around spending and saving: if you want something, you have to put in the work to get it and sometimes be willing to wait. That’s how I grew up too.”
So, what’s Alan looking for help with?
“Right now, we’re the ones managing the kids’ savings, but I’d like to get them involved,” says Alan.
“Each of them has an account where we put birthday money, Christmas money and so on, but the kids don’t know the balance of their accounts. My worry is that if they know how much is in there, they’ll think, ‘I’m loaded, I can buy whatever I like.’ I’d like to be more transparent with them about how much is being saved on their behalf, but it’s really important to us that they understand that savings are not there to be spent whenever they like.”
Here’s what David Coleman has to say…
“I agree that if you suddenly let the kids know how much is in their savings account, the result may be that they want to spend that money right away,” says David. “So this conversation needs to be paired with a conversation about the difference between disposable income, necessary spending, and long-term savings.”
He recommends an account with multiple sub-accounts, like An Post Money Mate‘s Jars, as a way to help kids understand the difference.
“With the 13 and 15 year old, there might be a jar that they can use if they’re with friends and want to buy food. But for each child, designate a jar for bigger purchases that can’t be touched unless they’ve discussed with Mum or Dad first.”
If Alan feels the kids need an extra push, some incentives can help, says David. “You could agree with the kids that if their savings reach a certain amount, you’ll add another 5% yourself. That way, they can see that it’s worth their while to hold onto their money.”
Want to help kids to understand the value of money? Try one of David’s three conversation starters…
1. Do you need this, or do you want it?: This can be a simple way to put things in perspective for kids, says David. “They know that as they grow, they need new clothes. But they don’t necessarily need a particular brand of jeans. That’s a want, and it’s something they’ll need to use their disposable income for.”
2. What’s your plan to earn money for that toy/video game/trip?: “If your child asks, ‘Can I have that?’, this is a good opportunity to help them see that yes, they can have it, but only if they plan and save for it.”
3. Do you feel you got value for your money?: “It’s important to let kids have freedom around spending their own disposable income, within reason. But once they’ve spent the money and a day or two has passed, reflect on it with them. This will help them to really consider the money choices they make.”
An Post Money Mate is the new account available for children aged 7 years to 15 years and six months. With An Post Money Mate, your children learn how to earn, save and spend money with their own debit Mastercard and app. They get independence, you retain control. Download the brand new An Post Money app to get started.
T&Cs apply. The An Post Money Mate Debit Mastercard is issued by An Post. Mastercard is a registered trademark. A monthly maintenance fee applies. An Post is authorised by the Minister for Finance to provide payment services and is regulated by the Central Bank of Ireland in the provision of such services.
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