Let’s really teach kids about money.

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Posted by: Sue Atkins

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I’m chatting on BBC Five Live Radio today about this initiative to teach children about saving, budgeting and learning the value of money.

This strikes me as a great idea as children need to learn how to manage money and it starts with the way you talk about money, the way you handle money and the way you act around money. With the help of this school initiative and your input your children will become empowered around taking care of themselves financially long term free from the crippling effects of debt.

Children as young as four are being encouraged to join savings clubs as part of

a bid to prevent them relying on payday lenders or racking up heavy debts later

in life.

 

The Church of England is proposing a network of clubs in primary schools run by

credit unions which will help teach youngsters to take a responsible approach to

money from an early age.

 

Under the plans, children would be able to save small, regular amounts of

money, and would also be given the chance to take part in running the groups,

such as working as junior cashiers or bank managers.

 

Parents and school staff could also sign up to the clubs, with mothers and

fathers able to set up dedicated accounts to save for particular expenses such

as trips and school uniform.

 

The proposals – which would be piloted in Church of England primary schools in

three areas to begin with – have been drawn up by the Archbishop of Canterbury’s

new Task Group on Responsible Credit and Savings.

 

The task group was launched at the beginning of the year in the wake of

comments by the Most Rev Justin Welby that he wanted to drive payday lenders out

of business through the creation of credit unions.

 

Credit unions are usually small financial co-operatives set up by local

communities and other groups such as trade unions.

 

Savings clubs in schools can be a good way to improve children’s financial

knowledge through practical education and traditional lessons, according to a

report published by The Children’s Society.

 

It says research has found that nearly two-thirds of children (64%) get their

first bank or building society account before they start secondary school, while

nearly three-quarters of 15-year-olds with a bank account have a debit card.

A separate study concluded that more than half of 10 to 17-year-olds said they

saw advertising for loans “often” or “all the time”.

 

“With children making financial choices at an even younger age, and regularly

exposed to advertisements for credit, it has never been so important to ensure

that children learn about debt and money management from an early age,” a

foreword to the Children’s Society report warns.

 

The Church said it was focusing on savings clubs in primary schools partly

because it is responsible for one in four primaries in England and also because

financial education is already part of the national curriculum for secondaries.

It is looking for funding from Government and private companies for the pilot

scheme, which would run in six schools over nine months, before being rolled out

to 100 schools in the three chosen areas.

 

If successful, the scheme could become a voluntary national financial education

programme for primaries, starting with those run by the Church.

The savings clubs would be given “seed” funding of around #1 per child per

term for the first year for all youngsters who want to join and take part.

Sir Hector Sants, chair of the task group, said: “Savings clubs can transform

lives through helping establish a responsible approach to money from an early

age.

 

“This programme would also strengthen communities through building links

between schools, churches and credit unions, and is part of the Church of

England’s broader initiative to support the development of a larger, vibrant and

more sustainable community finance sector in this country.”

In July last year, Mr Welby told Errol Damelin, then chief executive of payday

lender Wonga, about his ambition to make the controversial lenders redundant by

helping the credit unions play a much bigger role in helping people in financial

difficulties.

 

It later emerged that the Church of England indirectly invested £75,000 in

Wonga, out of investments totalling £5.2 billion, which Mr Welby acknowledged

was “very embarrassing” following his remarks about the payday industry.

The Church announced earlier this year that it had ended its severed its ties

with the payday lender.

 

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