The current cost of living crisis

I’ve often talked about money saving and money-making ideas as a way to boost income and reduce costs. However, we’re currently experiencing rather unique circumstances and for the first time I’ve been properly talking to our children about how the macro things affect us.

I’ve always advocated talking to children about saving and budgeting (when they are old enough to understand). Now more than ever, I think it’s important we talk about what’s happening and its personal impact. It’s also vital to have these discussions to put into context what children have undoubtedly consumed via their peers, TV or social media.

How we’re talking to the children about rising costs

Honesty is the best policy. We’ve been having lots of conversations about topics such as inflation, interest rates, mortgages and rising food, petrol and energy costs (and how they all interlink). We’ve stressed the importance of being mindful about our consumption but at the same time have allayed concerns. It’s a fine line between raising awareness and causing panic; we’ve tried to counter the sensationalist headlines they’re exposed to.

Reinforcing good habits

We’ve mainly tried to reinforce habits that we’ve always promoted and explained how these help. These include:

• The importance of saving
• Switching off lights when leaving a room
• Turning off appliances and electronic devices when not using
• Not wasting food
• Not spending money on ‘stuff’ for the sake of it (differentiating between wants and needs)
• Being savvy when it comes to shopping
• Putting on a jumper instead of immediately whacking on the central heating (this will be coming into play soon!)

Cutting back and lifestyle tweaks

We’ve said that we’ll need to cut back a bit in the autumn and winter but have not been dramatic. Ultimately, it’s important to be realistic. It’s also important to not paint it as an insurmountable problem (even if it feels a bit like that). A key thing has been to emphasise how they can actively help.

Be clear with children if the current climate means you have to cut back on some of their favourite brands at the supermarket, or if you need to take them to more budget-friendly clothing stores to pick out new items. Reassure – but don’t promise – them this should only be temporary and help them to understand how important it is to appreciate all that they do still have, rather than what they don’t.

Brean Horne, a personal finance expert at NerdWallet

I think it’s imperative to manage expectations especially with celebrations such as Halloween and (dare I say it) Christmas coming up. Whilst we might previously have bought a new costume for Halloween, we’ll be customising stuff we already have. Similarly, we won’t be ordering costumes off of Amazon every time there’s some event or dress up day at school.

We’ll be cutting down on things like bowling, cinema trips and pub lunches. Instead, we’ll be hunting for new walks and doing free and outdoor activities such as going to the seaside, visiting museums and having more film nights at home. Our National Trust membership is very cost-effective for days out. We also love having family games nights, which don’t cost a penny.

And finally…

I often find that children are more perceptive than we give credit for. By involving them in conversations and explaining things realistically, you might be surprised at how understanding and helpful they are.

The post Discussing the rising cost of living with children appeared first on The Parent Social.

Pocket Money Habits

She was asking as they currently give £1 a week but were informed by their daughter that ALL her friends got more.

There were a variety of responses including:

• My two get £2 per week which they can spend on anything they like. If they don’t do their jobs and keep their rooms tidy, it goes down…..

• Only in return for little jobs like clearing the dinner table, plumping the sofa cushions (!) and making sure he wipes away the toothpaste from the sink bowl.

• My daughter has £3 a week (when we remember!). She has 3 money boxes, £1 each: One for spending, one for sharing and one for saving. But if I’m buying a magazine or something for her brother and she wants one, I’ll substitute the spending £1 for that. She saved £42 of her spending one to buy a suitcase from Smiggle!

• Emily earns money for good behaviour; she normally gets between £2-£3 a week.

• They only get money if they do extra jobs ie hoover car/stairs. Hence they don’t get money every week!

goHenry

Then someone mentioned goHenry cards. They said they found them good as they give an idea of what the going rate is for certain age groups.

I immediately looked into it.

We’ve just received Sofia’s card and she could not be more excited. We haven’t learnt the full ins and outs yet, but it’s for children aged 6-18, and essentially you have parental control of a pre-paid card and app. I fund my own linked account and then can automatically transfer a set amount of weekly pocket money on the proviso that chores are done. I can also do one-off transfers and take money out of her account. Sofia can use the card at cashpoints to withdraw money and can use it as a debit card in shops. I can set a maximum spend per month and there are loads of features such as charting spending versus saving.

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