Promoting Better Financial Skills

financial awareness

Recently, I was on the BBC. Yup, national BBC – not just local. It turns out that 1/3 of millennials will be renting for life and they wanted someone to come speak about it.

What I said was simple; I choose to work in a sector that I love, making the world a better place. And that means that not only do I rent but I also live in a houseshare.

After having relative financial freedom in Japan and Germany, coming back to the UK I had to relearn how to be frugal. I’m always on the look out for better ways to stay on top of my finances and I am really passionate about giving students the skills to manage their money.

I grew up watching my dad at the dining room table going through his blue accounts books, checking our budget. It’s thanks to his careful planning that we were able to save up to go on holiday; we knew we had to buy clothes at car boot sales and only shop at Aldi, but it meant that we could have nice things otherwise.

I’d like to lay out a couple of ways to be better at finance. These can be used either for yourself or to help a young person, it’s up to you.

Get a budgeting app

We’ve seen the adverts for budgeting app. The one that messages you when you’ve spent too much in Superdrug, or the one that you can speak with through Facebook Messenger.

I looked into these (specifically the Wallet app). When I found that it wanted to know my current account login details, including my password, I contacted my bank to see what the deal was, and they told me under no circumstances must I give these details out. I wondered how many other people had done so.

For a few weeks I manually uploaded my statements from my online banking platform to the app, then assigned each payment to the category.

It was a massive faff.

Then I found Monzo. It’s another budgeting app, but with great differences to the others on the market. How I use Monzo is thus: I transfer an amount of money a week to my Monzo card (yup, it comes with a card) and then use it for all my frivolous purchases. Simple.

The benefits of this are:

  • I can keep a tab on how much I spend each week.
  • Monzo categorises (accurately!!) all my spending.
  • Monzo doesn’t have access to my current account.
  • It has contactless payments.
  • It’s free to use abroad.

It also has an option to round up payments I make. So for example, if I spend £1.60 on a coffee, it’ll add 40p to my pot. I currently have about £15 in my pot.

If you have a young person, this is great for them as you can transfer money to them as and when they need it, and also you can go through their spending together. If you’re an educator, know that it’s free for them to get this – a card and the app to track purchases. They can get their part time wages paid into there if they like, or use it like I do, giving myself a weekly pocket money amount to spend.

Be more mindful of EVERYTHING you spend

I use Monzo to track the things that I have a choice in purchasing (like that coffee, or that meal out), but like my dad, I need to be mindful over all the things I spend money on.

Many people are fighting for money to stop being a taboo, and I feel this starts with people going through their finances with their children. Tell your children how much you earn, and then when you make decisions like switching broadband provider, or deciding which supermarket to shop at this week, include them in that discussion.

University isn’t just one of the key things in education to help social mobility because it helps people learn more, with a shiny piece of paper to prove it. University kicks young people out of the nest and allows them to learn how to cope by themselves. But without anyone having spoken to them about tracking spending and making good financial decisions, how are they supposed to thrive?

An activity I have run in classes before is to go on Indeed to find an average local job, then to Salary Calculator (or the like) to work out the takehome. We then make a list of all the things we’d need to pay: rent, council tax, utilities, broadband, food etc. Even though I run this with 15/16 year olds, a lot of this comes as a complete shock to them.

This should not be a shock to an older teenager who will be independent in just a couple of years.

Help me make this change.

Make priorities and switches

Today someone asked me if I’m planning to go to Japan this year. I told them to their surprise that I don’t take holidays right now.

I like to spend money on books and eating out. Those are the things that make me the happiest. Therefore, I switch Tesco shops for Aldi. I switch clothes shopping for eBay hunting.

Just like when we were little and we knew that in order to go on holiday we needed to buy things from carboot sales, or hunt around in used furniture shops when we needed to replace something in the home, I have stated my priorities and make switches on everything else to be able to afford them.

Again, we shouldn’t feel that this is taboo; being open with friends about our financial decisions makes things much easier (like not being pressured to split the food bill down the middle when you’ve made careful menu choices). And by including teenagers into your decisions you can help them understand why it’s not a priority to buy that new game or to get yet more trainers, when as a family you’ve decided that you want to go to Florida.

 

Whether for yourself or for a young person, I hope these steps have been helpful! If you are an educator or parent I would love to know how you help your young people be more financially aware!

Comments

  1. I use mint.com for tracking my finances; I’ve been doing it there for about ten years now and although the site has changed a lot (and not always in good ways) since it was purchased by Intuit, I still think it’s fantastic to be able to see where every dollar has gone.
    Steven recently posted…Dinosaur World, FloridaMy Profile

    • Charlotte says:

      I only just saw your comment now – so sorry!
      My dad had a mint.com card – it used to be quite iconic in its different shape. I think they’re not as popular here in the UK as they were 10 years ago.

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