The Importance of Teaching our Kids about Money

FOCUS: THE IMPORTANCE OF TEACHING OUR KIDS ABOUT MONEY

This month we shift our focus to our children and the importance of teaching them about money

Regardless of our own financial circumstances, if we are to bring up kids who are able to live a full and happy life, it’s important we give them the tools to manage and understand money.  The saying that money doesn’t buy happiness carries some truth, but considering our entire planet revolves around its exchange, what money does or does not buy us most definitely impacts on our happiness.

The Benefits of Teaching our Kids about Money

There are many benefits to teaching our kids about money, for us and them!

In making a commitment to do this, it makes us look at the way we ourselves behave around money. If we constantly spend without saving or pay little attention to what is coming in and out of our bank account, we aren’t going to be in a position to set a good example. That isn’t to say we can’t, it just means our children learn by watching us.

If we can get to grips with some basic information to pass over to our kids it enables us to look at the way we manage money ourselves and work to improve that, thus providing a better example for our kids to follow.

As with anything, our kids learn their behaviour by what goes on around them. As parents we impact heavily on this. School, friends, family and other environments they are open to will affect the way they learn about money too.

If we are consistently giving them positive messages about money, this will become their normal. To give you an example of this, most of us can probably relate to being told certain things about money when growing up. As a child you take things literally and so these things take root and become your beliefs around money. For example, imagine you are told every day that there is not enough money, money doesn’t grow on trees, money is the root of all evil and money is hard to come by. As children, the messages we are given around money will most often shape our beliefs and behaviours around money as we grow into adults.

This highlights the real benefits of relaying very positive messages to our kids about money!

Where to Start

The most obvious place to start is with ourselves. By being conscious of what we say to our kids about money will help them create healthy beliefs around money. Money is after all just paper – it is the meaning we apply to it that really makes it what it is (or is not) in our lives!

Start with the basics:

  • Give your kids an amount of money each week and explain that it is a good idea to save at least 10% of this (working out the percentages will also help with maths too). If your children are too young to understand percentages, explain it in a way that they can understand or show them with the money itself i.e. suppose you give them £5 each a week, have them work out the 10% to save or give them the money in change and show them what to save, taking out the 50p.
  • Talk to them about money in a positive way. Explain that money is used as a value exchange – kids obviously aren’t going to understand the word value in the way that we do, so talk to them on their level in a way they can understand. Perhaps around toys – for example, the value of a football or sweets etc.
  • Teach them about spending. Give them positive messages about paying bills on time, the reasons we work and have money so that we can pay for things.
  • Help them to understand spending within limits and why that’s important. Talk to them about debt and how that impacts on their quality of life.

Most importantly make money fun. Spending money should be fun but not so that you leave yourself with nothing. Help them to see that money is meant to be used for good and to benefit our lives and that ultimately paying yourself first by saving is the best thing you can learn to do for yourself!

Resources

Fortunately we have the power of Google and you’ll find some great articles, tips and advice about teaching your kids about money. You’ll also find you become better at managing your own money through doing it too!

ENJOY!

 

Categories: BLOG.

Benefits of a Payroll Scheme

Saving isn’t something that comes naturally to all of us and many people live from month to month financially, which can be difficult when it comes to times when you really need money in an emergency. This can be anything from an appliance breaking down, home or car maintenance to needing to travel somewhere. Having regular savings isn’t just about paying for the things you want, but more linked to security and knowing that if you need something urgently you have the money to pay for it.

If you’ve ever read anything about building wealth and managing your finances better you’ll know that the general rule of thumb is to save 10% of everything you earn. Now we know that this isn’t always going to be possible, but as a starting point it’s a good guideline. Let’s keep it simple; if you earn £1000 a month, to save 10% would mean you would need to save £100 a month – does that seem reasonable? If it isn’t then work from this until you reach a figure that is. Even saving 1%, just £10 a month, is better than saving none at all.

Credit unions are all about serving people and improving the financial wellbeing of the local community. One of the ways they do that is by forging relationships with local organisations to set up payroll deduction schemes.

 

How do Payroll Schemes Work?

The best way to think of a payroll deduction scheme is in the same way that a pension payment is made; directly from wages or salary. A link is set up between the credit union and the payroll department of the organisation. Members of staff sign up and open a credit union account and then specify a savings amountto be deducted each month or week. The amount is deducted from the net salary (after tax) and transferred directly into their credit union account.

ORGANISATIONS

Why is it easier to save this way?

One of the biggest mistakes people make when saving is that they wait until they have paid or bought everything else before deciding what to save. Returning again to our point on building wealth and managing your finances better, you should always pay yourself first. Now we are not suggesting you avoid important bills or payments, but by considering a regular saving amount you can afford and paying that first, means you are more likely to succeed with your savings than if you consider it as an afterthought, once you’ve paid everything else. By doing it this way, the savings amount becomes an important payment you make each week or month, but the beauty of it is, you are paying yourself! We all deserve to have the security of savings and this is a tried and tested way of doing it.

Just like any other banking organisation, your credit union savings are protected by the Financial Services Compensation Scheme up to £85,000.

Are there any other benefits of joining a Payroll Scheme?

Yes! Part of managing your money better is being able to borrow when you need it. If we dipped into our savings every time we needed something we would have nothing left and so you may wish to borrow from time to time too. Credit unions often give a preferential loan rate to their payroll scheme members. Once a credit union member, payroll scheme organisation members can apply for a loan and have the loan repayments made in the same way; deducted directly from their salary. For peace of mind and confidentiality, payroll departments do not have any information on what the payment you are making to the credit union is for (i.e. it could be for savings or loan repayments). You only have to specify the amount and frequency. The payment is simply sent to your loan account for repayment.

How can I join a Payroll Deduction Scheme?

A lot of local councils and housing associations will already be members of a payroll scheme. If your organisation isn’t you can simply approach your HR department and ask them if they would set one up. Credit unions have teams who work on this specifically and the process is quite simple in terms of setting a up the scheme and putting everything into place. You can find out more about the Nottingham Credit Union Payroll Pro Scheme by clicking here and share with your employer by visiting and when you land on the page and have read the information you can watch the short video that gives you an overview too.

 

 

Categories: BLOG.

25 Ways to Start Saving Money Today

Budgeting and saving money can seem like a daunting task, but it doesn’t have to be. Here are is list of small changes that you can make that will save you a lot in the long run:

  1. Set money aside without having to think about it. Make regular contributions to your Nottingham Credit Union savings account by standing order or from your salary (if you work for one of our employer partners). Before you know it, you’ll have saved up a fair amount of money without ever realising it had gone.
  2. Switch energy providers. You can find the cheapest deal with Money Saving Expert’s Cheap Energy Club.
  3. Unplug appliances when they’re not being used.
  4. Use comparison shopping sites like http://www.mysupermarket.co.uk/ to find the best deals for your weekly food shop. You can compare individual items across stores to see which one has the lowest price at any given time.
  5. Take advantage of supermarket loyalty cards like the Tesco Clubcard and Sainsbury’s Nectar Card that allow you to earn points and vouchers.

tesco clubcard vouchers

Image: telegraph.co.uk
  1. Buy food in bulk and store it in the freezer to get lower prices and avoid waste. You can find a list of freezable foods here.
  2. Use a slow cooker to prepare meals for the week instead of eating out. It’s cheaper than using the oven and you can leave it on while you’re at work to come home to a freshly cooked hot meal.
  3. All of those meals out with your friends can start adding up. Instead of going to a restaurant, take turns cooking for each other or have a potluck. It costs a lot less and can end up being more fun!

potluck dinner

Image: linkedin.com
  1. You can also save a lot just by taking your own lunch to work instead of eating out. Just set aside a few minutes the night before or in the morning before work.
  2. Invest in a reusable water bottle rather than buying bottled water.
  3. Buy store brand instead of name brand. Often times you can’t taste the difference and it can end up saving you a lot in the long run.
  4. Make your own beer and wine. You can buy a kit at Wilko’s for as little as £10 for 40 pints. Not only is it 25p per pint, but it’s also fun to make as well.
  5. You can also grow your own herbs as opposed to buying them as you need them. A basil plant from Sainsbury’s costs £1.50 and keeps growing back, whereas a bunch of fresh basil costs 80p and will go off in a few days.

basil plant

Image: guide-to-houseplants.com
  1. Take advantage of reward cards like our prepaid card that offers cashback at many national and local retailers.
  2. Check to see if your children are entitled to any benefits such as free meals or school uniform.
  3. Do your holiday shopping right after the holidays when everything goes on sale. You may not want to think about Christmas in January, but it will save you money later in the year.
  4. Buy presents in advance during seasonal sales. The recipient will never know you got a discount on it and you won’t have to worry about finding a gift at the last minute.
  5. Exercise at home instead of paying for a gym membership. There are plenty of workout videos you can watch for free on Youtube on channels such as PopSugar Fitness and GymRa.
  6. Youtube is great for learning how to do all sorts of things. You can save money by doing things yourself instead of paying someone, such as cutting your own hair.
  7. If that sounds a bit intimidating, you can always go to a beauty school to get your hair done at a discount or even for free.
  8. Sell old mobiles and electronics for cash by finding the best deal on http://mobilevaluer.com/.

selling old mobile phones

Image: howstuffworks.com
  1. Sell things you no longer need on Ebay and get good deals from other sellers on things such as clothing and home goods.
  2. Take advantage of free trials such as Amazon Prime and Netflix, but don’t forget to cancel them before the trial period is over!
  3. Quit smoking. You no doubt know the health impacts of smoking but it could be burning a hole in your wallet too.
  4. Avoid payday loans – come to us instead for competitive interest rates regardless of your credit history.
Categories: BLOG.