Money and family

Work out what you can give without going short, and agree it with your partner before you reply. Helping family is a lovely thing to do, but giving too much can leave you short yourselves¹. So start with your own numbers: income, bills and savings goals¹, plus how much you'd want in an emergency fund if either of your jobs came under pressure². Never lend more than you can afford to lose, and don't put money you need for essentials, such as school fees or a mortgage, at risk².

Then talk to each other first. If a loan is never repaid, a partner who wasn't consulted may end up resentful². Reply as "we", not as the one who said yes in the doorway. Decide where your line is, too, because lending to one relative can bring requests from others who are hard up².

Before any money moves, say whether it's a gift or a loan². Money given between family members is generally treated as a gift unless there's strong evidence it was a loan, and without a written agreement that can be very hard to prove³. For a loan, write down the names, the amount, the term, the repayments and any interest, and both sign^2,3. Pay by bank transfer and keep the statements; avoid cash unless you get a written receipt³.

Talk about money with them, and let them see you handle it. Talking with parents seems to be the main deliberate way children learn about money, and they watch and often copy everyday habits such as paying bills and buying groceries⁴. So narrate a little: "We're choosing the cheaper pasta this week because we're saving for the trip." You don't need to be an expert. Simple, regular conversations, pitched at your child's age, help them see where money comes from, where it goes and how to use it wisely⁵. Showing them how much comes in and how it's used for food, bills, transport and savings helps them understand the cost of living and why planning ahead matters⁵.

Hands-on practice counts too⁴. Letting children spend small amounts, say on a snack or a toy, helps them learn to choose, see what money is worth and take responsibility for their spending, though it can also lead to wasteful habits⁶. Piggy banks suit younger children because they can watch their money grow, and you can help a child save for something they really want⁵.

Pocket money has upsides and downsides. It can help children understand the effort behind earning, build decision-making and discipline, and grow independence, but it can also encourage wasteful habits and dependence on parents⁶. Some parents pay it weekly and others link it to jobs around the house; there's no right or wrong approach⁵. Pick one together and tell your children how it works. If your family likes the idea, you can also talk about giving: how donations help others, and how giving sits alongside spending and saving⁵.