Creating a ‘Nation of Wealthy Kids’

Written by Will Rainey on 15th Oct 2020

In the UK, more than 50 per cent of adults are in debt (excluding mortgages). This is leading to many people suffering from financial stress and worrying about money at least once a week. Something needs to change in order to make sure we don’t blindly let the next generation grow up and follow this same path.

So, what needs to happen? We need all parents to take action to ensure their kids grow up with a wealthy mindset. Thankfully there are simple steps parents can take to help bring up a ‘Nation of Wealthy Kids’.

For clarity, I have used the word ‘wealthy’ rather than ‘rich’. Whilst most people feel these words mean the same thing, there is a big difference. Rich means having lots of money to spend now. In contrast, someone who is wealthy has some money which they are looking after to make their lives easier. Wealth comes from what you do with your money, not how much money you have.

Why are so many people struggling financially?

Before I go through how to create a nation of wealthy kids, we need to understand why so many adults are currently struggling financially. The problem at the highest level is that people are spending all the money they receive (and in a lot of cases, spending even more than they receive).

It seems logical that people should just stop spending all their money. However, it’s just not that simple for many adults.

Logic plays second fiddle to our habits

Unfortunately, it is not logic that determines our decisions, it’s our habits. As you’ll know habits are notoriously hard to change. Many people who are struggling with their weight know (logically) that they need to eat better and do more exercise. However, due to their habits and behaviours it is very hard to actually do that.

The same is true when it comes to money. People who spend more than they receive have many different reasons why they keep spending. They have formed very strong habits and behaviours that mean it is a very difficult habit to break.

For example, many people buy a coffee on their way to work. It’s not straightforward to just stop doing that and save that money. They like the feeling when the server remembers their name and order. They look forward to the break between the end of their commute and stepping into work for the day. A lot of people feel they need a coffee in the morning.  All these small elements make it hard for them to simply stop buying a coffee each day.

Then there are all the social pressures to keep spending. If you buy nice clothes which you know are a bit expensive given your earnings, it’s hard to then start buying cheaper clothes. Both in terms of the self-realization that you can’t actually afford them and the potential for social judgement of why you are no longer wearing such expensive clothes. The same applies to cars and houses which are our main sources of spending.

It’s not to say people can’t change, there are just a lot of pressures and in-built habits which make it very hard to change. Anyone who smokes will say they wished they never started.

How to create a Nation of Wealthy Kids?

The good news is that you don’t need to be good with money yourself or have to sit down with your kids and talk about lots of technical financial terms for them to be part of the ‘Nation of Wealthy Kids’.

We just need our kids to grow up forming a habit of not spending all the money they receive. The key message is ‘form a habit’. We can’t just simply tell them one time only not to spend all their money.

As parents, we need to proactively encourage our children not to spend all the money they receive, every time they receive money.

You may have noticed that I said, ‘not to spend all the money’ rather than ‘save their money’. They both mean the same thing but there is good reason to use the former. ‘Not spending all your money’ means your kids still feel like they can enjoy spending, just not ALL their money. Whereas ‘saving your money’ feels like a new action which is hard and takes energy to maintain (and is therefore less likely to be maintained). So, focus on them ‘not spending all their money’.

When talking to your kids about this, focus on the positives of not spending all their money. For example, they will have more money than most adults or highlight this is what the wealthiest people in the world do with their money or, if they put the money away in a savings (or investment account) then they will be making money whilst they sleep.

Remember, it’s not how much money they have that’s important, it’s how they manage their money that determines whether they will be wealthy or not.

Actions you need to take:

  1. Get your phone out
  2. Open the Reminders app
  3. Add ‘Weekly pocket money’
  4. Set it to repeat every week (this is very important as they need to receive money regularly in order to form a habit and we can easily forget as weekends can be very busy!).

Done that yet?!

Then when you give them pocket money, encourage them to think about how much they are going to spend. The key is to highlight that not spending it all is an option and is the option they should take.

Don’t underestimate this action. Even if you give them just £2 per week, get them to keep at least 20p. 20p might not seem worth keeping but it’s not about the amount, it’s about the action. Over time those 20p’s will add up. Also, as they start receiving more money the amount of money they have will build up into a nice amount.

To really help your kids visual the impact of this action, get them to think of money as seeds. They can give their seeds away which is like spending their money. However, the seeds they don’t give away will be planted and can grow into something beautiful over time. This could be a new toy in the future or it could be more money (interest or return). Over time they can picture their financial forest growing.

If you don’t have cash around the house, then you can use online tools to give them digital pocket money.

Top 5 apps to help children manage money

The above actions should not just apply when they receive pocket money. Encourage them to not spend all the money they get on other occasions too (birthdays, Christmas or from the Tooth Fairy).

Research from Cambridge University shows that kids form many of their money habits from as young as seven. Therefore, the younger you help your kids form the habit of not spending all their money, the easier it will be.

If you take these actions, you’ll be helping your kids go down a new and brighter path than many adults today. This means that your kids are more likely to grow up financially health and wealthy and as part of the Nation of Wealthy Kids.


We need something to change in order to stop the trend of young adults suffering from financial stress.

To make sure the next generation don’t follow in the same vein, parents need to take action.

We need to proactively help our kids to grow up spending less than they receive, every time they receive money.

Even if you are struggling with money yourself, you can take action to make sure your kids grow up financially healthy and wealthy. You just need to commit a couple of minutes each weekend to give your kids pocket money and encourage them not to spend it all. It’s as simple as that.

After a few weeks or months, then you should consider opening a savings or investment account to help them grow that money. Then your kids can experience seeing their money grow over time.

Let’s work together to get this message out to as many parents as possible.

For more tips on teaching children good money habits see Will Rainey’s Blue Tree Savings blog.

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