/ Money, Parenting

What financial advice did your parents give you?  

parental financial advice

More than four out of five (83%) parents believe it’s their responsibility to educate their children about managing their personal finances, but many don’t feel up to the job.

These are the findings of new research by M&G Investments. And I’m not surprised.

After all, it’s been well documented how unlikely children are to get a good financial education in schools (despite it being on the National Curriculum since September 2014).

Financial advice from your parents

Some 71% of those surveyed agreed that saving money was the most important financial lesson their offspring should learn.

From memory, my mum’s advice on this topic rarely strayed from ‘stop spending all your money on stuff you don’t need’.

She’d most likely agree with the argument that millennials’ struggles to buy a house are down to too much avocado on toast.

I’ll give my dad a bit more credit (it is Father’s Day, after all).

Among the insightful titbits of advice he gave me, such as ‘always order steak medium-rare’ and ‘you’ll never find the girl of your dreams in a pub’, he told me to ‘save 10% of everything you earn’.

As I’m now attempting to buy a home in London, I’ve upped this to 30%. Sadly, his advice didn’t include the best ways to keep up with soaring inflation.

Educate yourself

The survey’s respondents also listed ‘the value of money’ and how to budget as important topics for youngsters to learn.

Still, one in six of those polled admitted they weren’t confident coaching youngsters how to manage their money.

Indeed, many of us reach adulthood with no clue about more complex topics, such as income tax and mortgages. I had to teach myself about these, and much more.

Did your parents give you any financial tips when you were growing up? Did you listen? Or, if you’re a parent, what financial advice have you given your children? What’s the best way to ensure we’re better educated about personal finance as a nation?

Who taught you how to manage your finances?

I'm self-taught (66%, 774 Votes)

My parents (28%, 324 Votes)

Other (3%, 40 Votes)

Which? (1%, 13 Votes)

My grandparents (1%, 9 Votes)

My secondary school (1%, 7 Votes)

Total Voters: 1,167

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It is daft to think we need to learn about anything UNTIL it is relevant to us. Therefore many surveys will ask questions that people quite rightly will not know the correct answer to.

As a finance professional for much of my life I did know more than the general public; I also knew that what I knew could be out-of-date by the end of day as a new product was launched or terms revised.

You only need to concentrate on the detail rarely. The rest of the time realise cash is king and spending is always easier to do as we are simple animals and a lot of effort goes into pandering to our simple instincts for immediate gratification.

“As I’m now attempting to buy a home in London, I’ve upped this to 30%. Sadly, his advice didn’t include the best ways to keep up with soaring inflation.”

Joe, is it not possible as a journalist to live away from London and provide content to Which? via the internet.
Seems daft to require people to live in over-populated, over-inflated London when they could live far more cheaply and healthily in other parts of the UK.

Not quite relevant, but my father turned down promotion and the opportunity of a senior position in the Civil Service because it would be likely to have a serious impact on my health. I suspect that the thought of losing his beloved garden may have been another factor.

My father gave me a good grounding in management of personal finances.

So many people live in debt. I do realise we all need a mortgage to buy a home. But why enrich banks buying a car on a plan? Get a cheaper second hand one. If you can’t pay off your card at the end of a month, save up first. Do you really need two or three cafe bought lattes a day? Think what they add up to in a year. Ask yourself if a purchase is a want or a need. It is like giving up cigarettes. You feel happier and healthier, and have a lot more money to spare. This is what we should teach our children. And with our children, they got used to the expression ‘we can’t afford it’.

Many are paying a high rate of interest on credit card balances and some seem to see this as a normal state of affairs. I pay my balance in full each month by direct debit and perhaps this should be the default on new cards. Of course my free credit is paid for by those who pay high interest charges. 🙁

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B C Thomas says:
20 June 2017

What makes you think that is was just one parent who taught me to be financially savvy?
Both mine had a hand in my financial upbringing. Mother on using pocket money. Father, later, on investing.

My parents gave me basic financial training by advice and example. I was always encouraged to save about half of my pocket money (even though in Saving Stamps I don’t think I earned any interest). Also when my school chums all had new bicycles bought for them on HP my parents said “never a borrower nor a lender be” and instead my first bike was bought second hand from a contact of theirs and my second bike was part financed by my savings and part with cash given for my birthday. Since then I have NEVER been in debt except for mortgages although I saved up the deposit for the first one and one bank loan for (I think) £1500 to pay for fitting out my first home – I paid it back over 18 months and resented every penny repaid. I am fortunate to have always been in employment and have always saved for luxuries like holidays, cars etc. I use credit cards as a substitute for cash but the balance is always paid off each month. I am now retired but still save about £500 most months for nice things when I need them. I self taught myself financial and investment planning having once been stitched up by some bad advice from a IFA. As I once heard said “The need for a loan is God’s way of telling you that you cannot afford it!” Both my offspring have on occasion got themselves into severe debt in spite of my urgings to live within their budgets. I guess some people will only learn from bitter experience.

My parents instilled in me, that there is one golden rule above all others ” Out of debt, Out of danger” .
What does it matter if you do not have the latest TV, phone laptop etc. If it works why replace it.
I don’t have to worry about debt, because I don’t have any, The only credit I have is my Credit card bill which is under £100 and will be paid when due.
If you are struggling with money, try some self control.

Sue says:
29 June 2017

My Mother’s advice was “You look after the pennies and the pounds will look after themselves”. “Don’t shop on an empty stomach!” “Neither a borrower or a lender be!” (I had to break that one to enable house purchase!)
Money Saving Expert also offers wise advice.