Parents have been urged not to underestimate the effect that their own habits and attitudes to money have on their children, as a new study reveals the majority of youngsters have a core understanding of the value of money by the time they are seven years' old.
The Money Advice Service found that most children can recognise and count money by this age and realise that cash can be used in exchange for items. Many seven year olds are also capable of planning ahead, understand choices and are able to delay making a decision, although it isn't until a few years later that they can ascertain something to be a luxury or a necessity.
The research has helped to highlight the importance of passing on financial guidance and knowledge to the next generation, particularly during the tough economic climate.
Financial education was recently made part of the National Curriculum at secondary school level, although there have been calls to teach younger pupils in primary schools about money to reinforce basic knowledge from an earlier age.
Caroline Rookes, chief executive officer of the Money Advice Service, claimed the study demonstrates the power of parents' influences over their children.
"This study illustrates how much of what you learn is absorbed when you are young, both consciously and subconsciously, and affects the choices you make throughout the rest of your life," she said.
"Over the next few months, we will be working closely with experts in education and the financial services industry to bring together a forum, and develop world-class parenting and teaching resources."
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