Telling Children About The Cost of Living

The cost pressures are having a real impact, given almost half of UK families have less than a month’s income in savings. Worse, around 1.3m families have no savings at all. Family money worries can impact children. How do you talk to your kids about the money pressures?

Kids know there’s a proble

A recent study showed that 90% of children (11-18) are aware of the cost of living crisis. Children can worry about stressed or anxious parents. Parents assume that their financial problems don’t impact on their children’s lives. If you think your children aren’t aware, then think again.

Hold the line

1. Don't give in to child pester power, as the extra spending can hurt the family finances.
2. Keep the language simple when children ask for things. It’s fine to say not right now.
3. Talk honestly about money, as teaching children about avoiding debt or saving for emergencies are great life skills.
4. Leading by example and showing children how to adapt to financial hardship is a positive event.

Teaching your children to cope 

As families cut back on the luxuries and some essentials, it’s important help your children to cope:

• Teach your children about the difference between wants and needs.
• Give children real money choices.
• Give them pocket money so they can save up for things they want.
• Teach them jam-jar budgeting, so the kids see money growing.
• Let children pay for things with money, so they see the change that they get.
• Help kids to draw up wish lists to stop any impulse spending.

Although it’s tough, aim to put a positive spin on making spending cuts. Maybe vote as a family as to which streaming subscriptions must be cancelled. The ONS state that the average household spend £1,744 on food at restaurants and takeaways every year. If reducing the number of takeaways or eating out trips, then have fun making pizzas or other food at home; ensuring the kids are taking part.

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Sources:

https://www.gohenry.com/uk/blog/family/how-to-talk-to-your-kids-about-the-cost-of-living-crisis

https://www.netmums.com/life/how-to-talk-to-kids-about-the-cost-of-living-crisis

https://www.resolutionfoundation.org/press-releases/1-3-million-families-including-one-in-twelve-poor-families-have-no-savings-to-cope-with-rising-cost-pressures-or-unexpected-expenses/

https://www.nimblefins.co.uk/average-uk-household-cost-food#:~:text=According%20to%20NimbleFins%20analysis%20of,restaurants%20and%20takeaways%20every%20year.

Date: 21 November 2022 by Max Robinson