Junior ISA lessons you wish you’d learnt at school
UK parents admit to wishing they had a better understanding of finances at school
37% wished they knew how to save money for short and long-term goals
28% wished they understood the value of money by handling cash early on
27% of parents under 30 wished they had learnt how to avoid using pay day lenders
37% of parents wish they had received a better understanding of how to save money for both short and long-term goals when they were at school, according to new research from Foresters Friendly Society.
Despite being an essential life skill, financial education was only introduced to the UK school curriculum in September 2014, so many adults left school without adequate understanding of basic finances, with potentially devastating impacts on their long term financial wellbeing.
For younger parents, the detrimental impact of a lack of financial education is significant, with the lack of transferable skills a contributory factor in the rising debt problem and ultimately contributing to growing reliance on payday loans to keep up with regular financial commitments. A surprising 27% of parents sampled, aged between 25 to 29, wished they had understood the importance of avoiding pay day lenders from an earlier age.
While Government measures support basic financial education at school, a thorough assessment of the curriculum’s effectiveness in real life situations is crucial. If they could go back, 28% of parents asked wish they understood the value of money by handling cash early on. 25% would have found an earlier understanding of financial markets and the wider economy useful in adulthood.
Paul Osborn, Chief Executive for Foresters Friendly Society, commented: “The ability to save is vital for basic money management in adult life, something that’s in high demand from parents who’ve missed out on a thorough financial education. While we can’t turn back the clock, we can take responsibility for instilling healthy saving habits in the next generation and help them make positive financial decisions.”
“That is not to say that total responsibility falls to teachers, as parents can help with the heavy lifting at home, with the aid of tools such as digital games and mobile banking apps. Another positive lesson would be to encourage children to regularly save part of their earned pocket money into a savings plan, such as a Junior ISA, to help teach them the value of frequently putting money away for the future. It’s also a tax-free way of generating a nest egg to help with future expenses such as university fees, first car or a deposit for first home so has the potential to do more than educate them on managing finances today.”
6 simple and practical ways to save money in 2019
With the January blues behind us, and a brand new year ahead to start afresh with our financial planning, there’s no better time than the present to start saving money! Follow these 6 simple tips to identify where you can save money and how you can make those savings work harder for you:
1. Create a personal survival budget
Make a spreadsheet showing all your essential monthly expenditure. It should include items like mortgage/rent, rates, utility bills, travel and car maintenance costs, credit card payments, plus essentials like clothing and food. Your completed sheet will tell you the minimum income you need to survive each month. See how to create a savings budget that works for you.
2. Spring clean your current account
Are you guilty of joining the gym and never going? Do you have a magazine subscription but never actually get round to reading it? Are you paying a direct debit for a service you no longer need? A quick glance over your monthly outgoings can flag any subscriptions or direct debits you no longer require. If you bank online you can usually stop these unnecessary payments with the click of a button.
3. Sell unwanted gifts and possessions
Raise cash by selling unwanted items from around your home. Take advantage of online marketplaces like eBay, Preloved and Facebook, as well as specialist sites for second-hand CDs, DVDs and books. There’s a huge trend for upcycling furniture at the moment, so before you take that table to the tip, why not try selling it online or at a car boot sale. Remember, one person’s trash is another person’s treasure!
4. Write a weekly food menu and order online
Get organised and minimise food waste by downloading and filling in an online meal planner. Try to do some batch cooking and freeze meals ready for evenings when you’re short on time. Once you have your plan, try shopping online and take advantage of low cost or free delivery slots. You’ll avoid impulse buys and those “Please can I have…” moments with the kids in the supermarket.
5. Set up a monthly standing order to a savings account
This is a fantastic way to cover the cost of your annual family holiday or save for a big purchase without knowing you’re doing it. A standing order will ensure you don’t miss the money and you’ll be surprised how quickly your savings mount up.
6. Take advantage of tax efficient savings such as ISAs
Every UK taxpayer has an annual tax-free savings allowance, currently £20,000 for 2018/19, meaning you can save up to this amount and not pay tax on any interest you gain. There are two types of ISA available – Cash ISAs and Stocks & Shares ISAs. You can save your full tax-free allowance in one of these types, or split it between them, however you cannot roll-over any unused allowance into the next tax year. That means if you don’t use it, you lose it! So when you’ve finished selling all your unwanted gifts, cancelled unused subscriptions and saved money on your food shop, you could put that extra cash in an ISA!
For more information or to request an information pack about Foresters Friendly’s Stocks & Shares ISA, click here or apply online today for a Foresters Stocks & Shares ISA.
Please note that tax rules may change in the future and depend on your individual circumstances.
The content of this article is for information purposes only and does not constitute financial advice. We do not offer financial advice. If you’re unsure as to the suitability of a product you should seek advice from a Financial Adviser. You may have to pay for this advice.
How to keep your resolutions going
It’s often all too easy to find a reason for ditching something that feels like hard work. But all is not lost – we speak to the experts about their tips and tricks for staying on track with your New Year resolutions.
No more excuses:
Talking yourself out of your good intentions with the same old excuses? Coaching Psychologist Jessica Chivers offers some positive answers to silence your inner cynic…
I haven’t got time!
When we say we haven’t got time what we’re really saying is that it’s not a priority. You need to work out what’s important and what you can let slide.
I can’t do it!
Confidence needs to be stretched and tested in situations that make us feel uncomfortable, so that it grows. It’s after doing something difficult that you look back with pride and think ‘I did that!’ And if you’re thinking ‘I can’t do it!’ because you’ve set yourself a big goal, it’s easier to break this into smaller actions that are more manageable. So, for example, if your goal is to become a writer, you could set yourself the task of writing a blog three times a week.
It won’t make any difference…
Instead, try adopting an attitude of ‘I won’t know unless I try’. Focus on what there is to gain from making the change and weighing that against what the downside might be (writing these thoughts down may be helpful).
A little kindness never goes amiss
You’re more likely to keep your resolutions going if you’re not too hard on yourself. Psychologist and life coach Cliff Arnall recommends patience, if you fail to stick to your resolution see it as a blip rather than a relapse. Remember that it can take two or three years to give up a habit such as smoking. What’s more, ‘giving up’ something can cause feelings of loss. It’s really important to replace it with something that’s good for you.
Add an incentive
Introducing a reward for sticking to a resolution can help get you back on track. For example, if you’ve decided to give something up such as smoking, your daily latte habit or the Friday night takeaway, save the money instead of frittering it.
Or, if it works better for you the other way round, try a self-imposed fine every time you arrive somewhere late or fail to go to the gym – whatever it is that you’re trying to do/not to do.
This way, you could also develop a regular savings habit and transform your finances. For example, imagine if you cut back on your daily latte habit and could then save £25 a month – that’s £300 a year, or £3,000 over 10 years!
This blog is intended to provide information, not financial advice, to help you make an informed decision about savings and investments. We do not offer financial advice. You should contact a financial adviser, who may charge a fee, if you want financial advice.
You should also be aware that in some investment conditions and depending on the product you have chosen, you may get back less than you have paid in.