Our new, in-app Money Missions are designed to accelerate your child’s financial education, and help us achieve our mission to make every kid smart with money. When they log into their GoHenry app and tap ‘learn’, kids can watch fun, animated videos, take quizzes and earn points and badges. You can use your GoHenry parent app to track your child’s progress; when each lesson comes to a close, another one begins, and your child will unlock new levels as they progress.
Spending wisely is the fourth Money Missions topic. It can be tricky to explain how to spend your money wisely as a kid, especially when there are so many sweets and stickers to buy, and the latest playground craze (pop-its, anyone?) to keep up with. And it becomes even more important to focus on how to spend money wisely as a teenager, when ‘must-have’ purchases become more expensive – and more accessible – thanks to wages from weekend jobs and the availability of credit for over 18s.
This is why GoHenry’s Money Missions make it easy for kids to understand the difference between needs and wants – and equip them with the knowledge they need to make smart spending choices.
How to spend money wisely
We all have choices to make about money: whether to spend or save, what to buy, and when to buy it. Knowing the difference between what we want and what we need can help us to make wise decisions and get the most out of our money.
- A need is something we can’t live without, like food, electricity or warm clothes in the winter.
- A want is something that’s nice to have but not essential, like a fashionable pair of trainers or a new video game.
The things that we need keep us safe and happy, so we should always make paying for them a priority. Everyone has different wants, needs and priorities, and they can also change over time.
Sometimes it’s helpful to make a list of all our needs and wants, and put them in order. This can make it easier to decide how to spend our money. It’s never too early to start thinking about making the right spending choices, as it’s a good way to make sure we have the money for things we really need.
To find out more, take a look at our Money Mission on needs and wants.
Emotion and peer pressure in spending
Peer pressure is one of the things that can affect the decisions we make about spending money. This happens when we’re influenced by other people’s opinions, so we might decide to buy the same things as our friends just so that we can fit in. Although it feels good to fit in, it’s much better to spend money on the things we love, rather than choosing the same things as our friends.
Our spending habits can also be affected by our emotions. Many people find that buying something new makes them feel excited and happy – which makes them want to spend more and more.
It’s important to remember that this rush of happiness and excitement doesn’t last, and we may regret spending money on something that we don’t really want or need. For this reason, it’s a good idea to wait for a day or two before we buy. This means that we can make sure we really want to buy something, rather than getting carried away by our emotions.
Take a look at our Money Mission on peer pressure to learn more about why it’s good to think about why we want to spend.
What is advertising and how does it work?
Advertising is a communication technique that companies use to encourage us to purchase their products – and this can have an impact on our spending decisions. Adverts are everywhere: we can see them on TV, online, in magazines and newspapers, billboards and even on the side of buses. They often use celebrities, cute characters or catchy songs to make us remember the brand’s name and encourage us to buy their product.
To find out more about how adverts and social media can encourage us to buy things, check out our Money Mission on advertising.
What is good value for your money?
When we’re spending money, the cheapest deal isn’t always the best option. We also have to think about whether we’re getting good value for money, and consider the quality of the item we’re buying. The ultimate goal is to get the highest quality for the lowest price. Some shops also have offers such as ‘buy one get one free’, or discounts like 25% off, which can mean that we pay less.
When making spending choices, we can also look at the way that things are made, and how they affect the planet or other people. For example, we can choose to buy Fairtrade chocolate, which means that more of the money will go to the farmers who grow the cocoa beans.
In the end, we each make our own spending decisions based on whether we care more about price, quality, or how an item is made.
To find out more, take a look at our Money Mission on getting value for money.
Spending money abroad
In the UK, our money is in pounds and pence, but other countries use different types of money such as dollars, euros, yen or rupees. These are all different currencies.
So, when we’re travelling to a different country, we need to exchange our pounds and pence for a different currency. We can do this at a bank or Post Office, or at a bureau de change at the airport.
As well as looking different, each of these currencies are worth different amounts – and the exchange rate tells us how much we’ll get for each of our pounds. The exchange rate changes all the time, so it’s important to always check the rate before we change money. This makes it easier to work out how much we’re spending in pounds, so that we don’t spend too much.
When your child uses their GoHenry card in another country it automatically swaps the currency. Both the child and parent app will show the amount they spent in the foreign currency as well as in pounds.
To find out more, check out our Money Mission on spending overseas.
Want to teach your kids all about earning, saving, and spending money?
Create a GoHenry account today and gain unlimited access to our new, in-app Money Missions. These feature fun videos and quizzes, designed to teach kids about finances and build crucial money skills from an early age.