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With age comes experience and it’s vital these lessons are shared down the generations


By Kara Gammell

Many of us learn the most important financial lessons when it’s too late, but as you age, you will have gained invaluable experience that, if shared, could help younger generations avoid the same mistakes. As wonderful as it may be to pass along wealth to your family members, it's just as important to share your financial values, experience and outlook as well as your cash.

Whether your children are still in school or have long flown the nest into adulthood, it is never too early or late to have open conversations about personal finance. Whether it’s covering the basics of daily money management or teaching them about longer-term actions, such as investing and saving for retirement – the value of your financial experience can be a great asset to your loved ones.

If you expect to leave an inheritance to a family member, regardless of the amount, it is crucial to prepare them for when they get their hands on the lump sum. Passing on wealth without sharing your wisdom can prove to be an expensive mistake. Sharing your money values can be part of your legacy.

Whether you plan to pass on just a few pounds or a pot of cash, many parents and grandparents find these important conversations hard to start. But it is so important to not be deterred and look for ways to share your values and your financial knowledge. If you want to teach children to make careful financial decisions, for instance, help them shop for an item they want by comparing features, quality, and price. If you want teenagers to focus on saving for the future, offering to match their saving contribution can be a significant motivator. Teaching financial responsibility starts early, and modelling it is a lifelong effort.

Ford Money’s recent research found that three quarters of 18-34 year olds say that older relatives and members of their community have shaped their savings and financial habits. In fact, younger adults are keen to learn more from those with more experience than them as three quarters of those under 35 want to take on board savings advice. However, while findings show that young British savers want to be taught more, nearly half of those aged over 45 admit that they haven’t shared savings tips with younger members of their families as they feel financial matters are a taboo subject.

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From savings to investment, budgeting to inheritance planning, the realm of personal finance can seem overwhelming and unfamiliar to a beginner – but starting with the basics is a great place to kickstart those essential conversations. There are numerous financial pearls of wisdom which you can pass onto the next generation, here are three topics to get you started.

  • Basic budgeting is a solid base: This time of year is often a chance for people to assess and organise their properties and give them a spring clean ready for the better weather. In a similar vein, giving your finances a spring clean is the first step to managing your money better. The key to this is a realistic budget. Many of us overlook the little extras that can send a more balanced budget into the red.
    Once they know where they stand financially, it will be easier to make sure all their outgoings are covered and are then able siphon off money into a savings pot.
  • Be prepared: If there is ever any money to spare, plough it into an emergency fund.
    Tell them that they should aim to have at least three months' salary saved as an emergency fund to provide a financial buffer – and due to the unexpected nature of such events, aim to keep the cash in an accessible account where you do not need to give notice to access the funds.
  • Start investing sooner rather than later: You seldom hear a seasoned saver talk about their spending, more often it is their investments that they focus on. Figures from Moneyfacts shows that stocks and shares ISAs, for instance, delivered positive growth in 14 out of 21 tax years since they were introduced in 1999.


By investing as much as they can in tax-efficient vehicles such as ISAs, one can avoid having to pay tax on either income or capital gains. Everyone in the UK over 18 has a £20,000 annual ISA allowance – in other words, you don't have to pay any tax on any stock market gains you may make.

Experts agree that while putting your money into a Stocks and Shares ISA is great for long-term savings goals, such as retirement, if you want to use that money a little sooner, it is wise to keep it in a cash savings account, like a Fixed or Flexible Cash ISA.

What’s more, it’s useful to have access to funds for emergencies and to avoid relying on credit.  You will not pay any Income Tax on the interest or dividends you receive from an ISA and any profits from investments are free of Capital Gains Tax.

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