As a nation, we tend to shy away from the topic of money. Our financial habits and attitudes to household finances are formed from a very young age and are largely influenced by how we saw our parents manage their finances.

Money plays a big role in our lives, it can affect our relationships, our stress levels and our overall well-being. How we use and talk about money has a massive impact on how our children’s relationship with it develops as they grow up.

There are so many critical skills that children need to survive and thrive in today’s world. Developing solid financial skills is one of these and it’s vital to their future well-being. It’s never too early to begin but equally important is it’s never too late.

Those real-life learning experiences have become few and far between due to the Covid-19 lockdown; we have less physical cash, shopping activities are reduced to one person, trips to the bank have become a thing of the past and we do most of our shopping online.

Childhood is changing and today’s parents grew up in a very different world. As money and spending becomes more virtual and invisible, it is vital to teach children and young people good financial principles which they can draw on whether or not they live in a cash-based or cashless world.

A great way to start having those conversations is to give your children pocket money and this can start when you feel they’re ready. Setting up a weekly allowance or tasks/challenges for your child to complete provides the perfect opportunity to teach them financial literacy.

You can discuss the importance of budgeting and spending money on things they need versus things they want. You can also use it to encourage children to save and set goals, which in a world of instant gratification, is so important. If you do plan on giving your children pocket money, consider giving half of it to them in cash and half as a digital transfer, so that they can equate what they have in their money box with what’s in their online account.

Once children are comfortable with the basics of money, it’s important to have conversations with them about the household income, how we get paid in return for work and what kind of expenses the household will face, such as the mortgage, household bills for heating, food and internet.

While talking to your children about saving up for something they want, it’s also good to talk to them about setting money aside for a ‘rainy-day’ or an emergency. Putting these concepts into things that children are interested in is key to sparking their interest and furthering their understanding.

Money in a digital world

Covid-19 has accelerated the change from the high-street to online and has forced many of us to readjust our day-to-day spending habits. Everything is available at the tap of an icon on a screen and many of our favourite apps have a ‘set it and forget’ feature that allows us to make purchases without a second thought.

It’s not pleasant to have to teach kids that there are dishonest people out there who might try to steal their money online. With more and more children using the internet at an earlier age, fraud is a topic that parents need to be more aware of as their children grow up.

Talk to them about keeping their money safe online, to never give their card details to anyone, watching out for sites that are unofficial or not secure and never to reveal their PIN or passwords to anyone.

How to talk to them

There are plenty of ways to introduce money concepts to your children. Younger children respond really well to role-based play with toy money, while for older children, there are online child-friendly financial services that are designed to empower children to spend and save in a digital world such as Starling Kite.

Whatever you decide to do or however you decide to teach your children about money, it’s important to teach them about the role it plays in our lives, the different ways to pay and your family’s approach to finance. You should also try to give your children some responsibility for making their own spending decisions.

Use every day financial transactions as an opportunity to talk to your children about money – from visiting the ATM to getting cashback and making online transactions. Make having financial conversations part of everyday life.

Elaine Deehan is Ireland country manager at Starling Bank