Starting a new year at school will always open up new experiences for your child, but the transition is steeper when they make that leap from primary to secondary school. Suddenly, they’ll be more independent and need to get used to managing money daily. Yet, with this comes the opportunity to teach them some powerful financial lessons. Here’s what you need to know.
Letting go isn’t easy, but moving to Year 7 and secondary school means there will suddenly be new friends you don’t know, days out where you’re not invited and money spent at an alarmingly fast rate. While you can only watch from the sidelines on many of the above, one area you can work with your child on is finances, daily spending and the importance of money management.
“Starting secondary school is a huge milestone in a young person’s life, and for most, it represents a great leap in independence. Our latest data shows the extent to which young people’s money habits change during Year 7, and reveals that travelling independently and socialising with friends now becomes much more important – and expensive.”
Louise Hill, CEO and co-founder, GoHenry
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School lunches
Unlike primary school cafeterias, secondary school cafeterias often operate on a prepayment basis (parents top up the balance each month or term) or use a cashless smartcard payment system for snacks and meals.
Either way, it means that for the first time, your child can decide what they want (at breakfast, break, and lunch) and pay for it without you by their side. This can lead to various issues, including overspending and not paying attention to how much is left on their overall lunch budget.
To combat this, set a daily lunch budget with your child that they know they can’t go over, whether that’s £3 or £5. This leaves them free to choose what they want but ensures they don’t spend £10 a day (£50 a week and £200 a month!). Also, get them into the habit of checking their lunch money balance on a weekly basis so they aren’t caught short in the lunch queue.
Money lessons learned: budgeting, checking their balance and living within their means.
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Independence & paying for a new social life
Of course, not all children opt for instant independence in Year 7, but even if your child isn’t ready to venture out with friends, it’s a good idea to show them how to budget their funds.
Introduce budgeting by helping them understand the importance of planning how to spend their money and distinguishing between needs (lunch) and wants (snacks).
Discuss how to make their money last all week, with firm boundaries around the Bank of Mum and Dad. Bailing them out when they run out of money won’t teach them how to delay gratification or budget.
“The simplest piece of advice,” says Louise Hill, CEO and co-founder of GoHenry, is to start by giving children some money, however little, so they can make their own decisions about spending it. This is the start of their money management journey and will help them learn about budgeting, saving, and spending responsibly. Plus, it's better to make a £20 mistake at age eleven than a £2,000 pound mistake at age 27. If you give your child some money and they blow it all, and then tomorrow they can't do something they wanted to do because they spent all their money — that's tough, but it's a great lesson.”
Money lessons learned: budgeting, saving, delaying gratification
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Encourage them to be a part of the circular economy
With new friends and a new social life comes a desire to buy new clothes and accessories. Explaining the circular economy to them can help with budgeting and spending, showing them how reusing, sharing, and buying preloved clothing and accessories help their budget and the planet.
Our data shows that GoHenry kids and teens spent £635,350 at shopping platform Depop. Those who shopped here each spent an average of £58.76, a 78% increase from the previous year. Currently, one-third of all 16-24 year-olds in the UK are registered on Depop, and there are now more than 26 million users across over 150 countries, 90% of whom are under age 26.
Vinted is another popular social shopping platform. GoHenry kids and teens spent £761,385 on it, an average of £45.22 per sustainable shopper. With clothing, trainers and accessories available here from every retailer you can imagine, prices start from under £5.
Money lessons learned: Saving, understanding financial priorities, becoming part of the circular economy.
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Starbucks, friends & after-school snacks
GoHenry data shows that teens spend significantly more on food and drink when they start secondary school, thanks to increased socialising habits. In the last academic year, Year 7 pupils used their GoHenry cards to spend a total of £4,326,140 on food and drink, an average of £51 per GoHenry member.
Whether it’s sweets and treats on the way home or a meal deal, the post-school snack is real and one worth talking to your kids about. Even if they are spending their pocket money, show them how spending £2 a day on crisps and drinks can add up to £10 a week and £40 a month. Suggest they set limits on their daily spending to ensure they have money for what they really want by budgeting their weekly money and delaying the impulse to spend on something they don’t want.
Peer pressure can make it difficult for teens to say no to spending, even if they are trying to save money or manage their finances responsibly. So make sure you have a chat with your child about how friends can influence their spending and how to say no without feeling you’re letting them down.
Money lessons learned: Budgeting, delaying gratification, standing up to spending peer pressure.
Encouraging and discussing financial skills like the ones above not only helps children understand the complexities of managing their own money but also equips them with the tools they need to make informed choices. That's a choice not just around spending and budgeting but also with delaying gratification and prioritising their needs over their wants.