Do you teach your kids about pensions?

MK62

LV_426 said:

Do you teach your kids about pensions?

Yes.....but the conversations are always pretty short.. ...still, at least they do pay into them!

MallyGirl

I have certainly covered the finance basics. At this point she's still at uni for another 4 years so I have focussed on savings - making sure she checks the rate hasn't dropped due to being an obsolete account, that sort of thing - plus she has a S&S LISA and a former S&S JISA that she leaves alone. The JISA enabled the discussion on how S&S go up and down.
We plan to retire early at around the time she graduates so that will be a driver for discussions on how we achieved that at 59.

Nurse2047

Workerdrone said:

Yes, probably because I also bang on about pensions with the Mrs so much. We set them each up a SIPP about 3 years ago. Iregularly talk about how it has round 50 years to grow and the importance of starting to contribute to their own pension as soon as they start working. They are currently 11 and 13.

Same here, my children are 11&13 and we set their SIPPs up about two years ago, only £25 goes in every month but we have shown the kids re compound interest and how your money grows over the years. My 13 dd is a saver however my 11 ds is not and he isn’t interested. Hopefully when he starts work I will talk to him again about the importance of starting young.. something I never did 😢

pensionpawn

Yes. On starting work we marketed pensions as saving for the longest holiday of your life and that you're getting free money from your employer and a tax rebate off the government. Also, that they'll get their personal pension 10 years before the state pension, if it still exists. All three of my daughters are in schemes, my youngest starting at 16 through her supermarket job whilst in 6th form, where contributions were matched at 7.5% She currently has around £3k5 prior to starting her final year at university. Prior to pensions on starting work all three opened a Halifix card cash account at 11, which for them was a cool way of managing their money as we paid their pocket money in monthly (no overdraft  ). Good money skills are essential in life. My eldest two bought their first homes with their partners at 23 and my youngest is in a (very good) company share save which matures in 8 months. Always contribute at least the minimum to trigger the maximum employer contribution.

kipsterno1

The child trust fund was a big help in explaining the benefits of saving. When it paid out we were able to show our daughter how much had been paid in compared to what she received.  Not sure she took it all in as maths and numbers aren't her thing but she reinvested it all and now continues to put a large proportion of her part time (still studying) income into an ISA.

Seeing my father retire before he was sixty made me think it might be a good idea to aim to do the same. I would like to think our daughter has the same idea having seen me retire at 51.

Malthusian

I've always contributed to an employer pension fund. Mainly because my parents always encouraged me to do so. But it's only in the last couple of years that I've really started to get a much better insight, and become familiar with the terminology. I feel like I've had my head in the sand for many years, when I should have been better informed. I really think that's the wrong way around

No, you did things the correct way round. If you had waited until you had a high level of financial knowledge to start saving for retirement, it would have been far too late.

On the macro level, the point of employer pension schemes, earnings-linked state pensions (pre 2016 in the UK), auto enrolment pensions now, etc etc, is to ensure that even people with their head permanently in the sand still get some kind of financial security.

I know it's a subject that is not in the least bit interesting to many young people, but I think that financial planning should be taught in schools.

Most teachers are the second worst people to be teaching kids about finance, after their parents. There's a reason the Teachers Pension Scheme is defined benefit, so that all a teacher has to do for financial security in retirement is tick a box when they take the job. (#NotAllTeachers)

Studies have consistently shown that whether you can "pass" the marshmallow test at age 18 or 30 (choose between two marshmallows in five minutes' time or one marshmallow right now) depends mainly on whether you could pass it at age 5.

I am not saying that "financial education" is entirely pointless but it's a fifteen-minute talk in assembly, not a forty-minute lesson, let alone part of the curriculum. Part of the problem is that there is no way for the kids to get practical experience, beyond spending of pocket money. (And everything they need to know about pocket money is covered in the fifteen-minute assembly talk.) It's like teaching maths by making kids sit still and listen while you drone on about the theory of calculus for an hour, and then saying "this will be very useful in five years' time when we'll let you actually do some sums".

Murphy_The_Cat

LV_426 said:

I know it's a subject that is not in the least bit interesting to many young people, but I think that financial planning should be taught in schools.

2 days ago, Mrs Cat asked the Deputy Head of our daughters school, why they don't teach anything about financial planning to the children.  the DH said that they do, once they are in the 6th form, but they only have a very limited timeframe pre 6th form.

(Removed by Forum Team)

My sprogs have both been shows/taught about interest rates, credit cards, debit cards, cashback, SIPP, loan, mortgage, JISA/ISA, current accounts etc etc, starting from about aged 12 onwards.***

*** as a morbid aside, my daughter recently asked "if you and Mum dies at the same time, how would I be able to access my JISA and pension?"  which rather took me aback at the time.

The next lesson was about executors, who they are and what they doo when someone pegs it.

cfw1994

Murphy_The_Cat said:

LV_426 said:

I know it's a subject that is not in the least bit interesting to many young people, but I think that financial planning should be taught in schools.

2 days ago, Mrs Cat asked the Deputy Head of our daughters school, why they don't teach anything about financial planning to the children.  the DH said that they do, once they are in the 6th form, but they only have a very limited timeframe pre 6th form.

(Removed by Forum Team)

My sprogs have both been shows/taught about interest rates, credit cards, debit cards, cashback, SIPP, loan, mortgage, JISA/ISA, current accounts etc etc, starting from about aged 12 onwards.***

*** as a morbid aside, my daughter recently asked "if you and Mum dies at the same time, how would I be able to access my JISA and pension?"  which rather took me aback at the time.

The next lesson was about executors, who they are and what they doo when someone pegs it.

We have always been very open and enthusiastic about teaching our (now mid-20s) offspring about money.  Schools aren’t the place to rely on that kind of education 🤷‍♂️

Many years ago we opened them Santander accounts, I think aged around 12.  Over the years the capability of that expanded, & of course the Uni years got them railcards too.  I’m sure other banks will have similar kids accounts (although I believe only one gives the free railcard 😉)

For a few years they have had small LISA/ISA/Pension funds that we have helped contribute to -  we view that as the useful part of their inheritance from us, but whilst we are very much still around!   They both understand the funds well, & both are also contributing to the funds where able.  

On your last point….sadly my wife’s dear old mum passed away a couple of weeks ago - at 89, the last of their generation on her side 😔.  Our daughter went with my wife to register the death.  My wife is the one (of three) who dealt with her parents the most (by far), and although joint executors, it is agreed she will be dealing with that over the coming weeks/months.  Again, we will keep ours informed on the ‘process’ as it moves forward.
Part of the reason for that was to let them know what they eventually will have to deal with.  Hopefully a few decades in the future 🤞

Your daughter raises a good point about the possibility of you both passing at the same time….. I have a document in progress on ‘what to do when…’ to try to address that.  Ours know the online cloud folder and important (finance etc) email to dive into should that catastrophe occur.   I didn’t spend my career in business continuity and disaster recovery for nothing 🤣

I recall them playing on their Nintendo gameboys many years ago on one long car journey.  Probably aged about 10/12.  We had to laugh - the conversation in the back of the car was about one of them paying off a mortgage 🤣

Our work here is done 🤪

gambleruk

I have a 20 year old son who in his last year in high school asked me why they did not teach about mortgages, credit cards, etc. He could not believe the rubbish he was being asked to learn instead of things which would be useful for him later in life. I go back many years to my education and the two things which really stick in my mind are having to do O level Religion because I was in the top class for 2 years, I was and still am much more interested in reading Ozzy & Iron Maiden lyrics etc than the bible.

The other one was having things in maths like the quadratic equation constantly shoved down our throats to make sure we understood it, it has been so useful in my past 35 years, I have no idea how I would have survived without it.............

Seriously though the last year in high school I honestly believe there should be an hour per week for all students to learn about all this stuff, even the ones who hate school would probably find some interest in it. For those who said do it at assembly, you are telling me that you could not spend 40 hours in a school year teaching young people about different aspects of money, my son as always been interested on how investments work but there was no lesson he could take or ask to learn more.

Imagine walking into class in your last year and the teacher says right you all have a pot of money to buy and run an house with, then every week throw in different stuff like pay rises,redundancy, market crashes, interest rates, getting married, having kids of there own etc, you could make it so much fun every week and if anyone can persuade me that learning the quadratic equation would be more useful then please free to comment  

Kim1965

I thinkyou have to teach your kids about finances especially ly as the education system  does not facilitate such matters.
 Its a bit if a standing joke with both my kids, they say im constantly banging on about pensions. Eldest 23 already in the tps. Youngest soon to join the workforce 2/3 chartered accountant qualified. He is likely to be a high earner and  and says he will settle on a standard of living and look to save a high proportion of income.
 My own parents were clueless, didnt own their home, negligible pensions etc It took me a while grasp how things worked, my kids have financial awareness and are likely to get an inheritance.