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Your Money Matters
Second Edition:


Published by Young Money
(part of Young Enterprise)
Young Enterprise

The Coram Campus

41 Brunswick Square

London

WCIN 1AZ


Young Enterprise is a registered charity.
Registered number 313697


© 2018, 2021 Young Money.
ISBN 978-1-9164672-0-0


All rights reserved. This book or any portion
thereof may not be reproduced or used in any
manner whatsoever without the express written
permission of the Publisher.


British Library Cataloguing in Publication Data
A Catalogue record for this publication is available
from the British Library.


Acknowledgments


Young Money would like to take this opportunity

to thank Martin Lewis OBE, Founder of
MoneySavingExpert.com, for his generous donation,
direction and passion that made this project possible.


Young Money would also like to thank the teachers
and consultants who guided the development of

Your Money Matters and the Department of Education
for their help and guidance in the development of
this textbook.


In addition, special thanks to:


Contributing authors


John Chapman

Stewart Jones

Emma Waller

Russell Winnard, Young Money
Liz Booth, Young Money


Other contributors

Chloe Shuttlewood, Young Money
Emma-Jayne Turner, Young Money
Robyn Vernon-Harcourt, Young Money
Eileen Gannon, Young Money

Feyi Onamusi, Young Money
Charlotte Churchill, Young Money
Braden Clamp, Young Money


Design by Something Big Ltd.


Printed and bound in Great Britain
by Bell & Bain Ltd, Glasgow


Quality Mark by Young Money


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ENSURE YOU'RE IN THE KNOWS,
NOT IN THE KNOW NOTS.


Foreword by Martin Lewis, aka the Money Saving Expert


It’s only money, isn’t it? Well, no, actually. It’s far more important than that. I’ve spent 20 years
campaigning on TV and online to get people to be better with their cash. Money isn’t just a
financial issue. Problems can infect every area of your life — your happiness, mental health,
work, relationships and more. This isn’t intended to scare you; | just don’t intend to sugar coat
it just because you’re still at school.


Of course, you likely already make money choices on a daily basis — such as picking your
phone or buying a friend’s birthday present — and as you move into independence the
decisions grow, whether you dream of getting a car, want to go to Uni, or getting your first
job. Throughout all of these, the knowledge and attitudes you have about money will become


even more important.


That's what this textbook is about. It’s here to start you out on your journey towards financial
literacy. While it won't come close to teaching you all the answers you'll need for life, it does
cover many of the main ones. Yet even if all you picked up was to take money seriously,

to read up and ask questions before making big decisions, and gain the skills to do the
numbers, it would leave me skipping like a little lamb (not a pleasant image | accept).


While some of your parents and guardians will be great with money, some won't, and it’s
important we level the playing field. That’s one reason |, and many others, campaigned for
years to ensure we got financial education on the curriculum. Yet that alone isn’t enough. We
live in one of the world’s most competitive economies. Companies spend billions advertising,
marketing and teaching their staff to sell, yet we don’t get any buyers’ training.


That needs to change. This textbook aims to make it easier for schools to ensure that every
young person receives a high-quality financial education by the time they leave school.


| hope you like it.


Martin Lewis


Young Money is very grateful to Martin Lewis OBE for funding the development
and delivery of this textbook into every English state secondary school.


Statement from the Rt Hon Nick Gibb MP


Economic and financial education are an important part of a broad and balanced
curriculum, and provide the essential knowledge that young people need to manage
their finances and succeed in the modern world. Both the Department for Education
and HM Treasury support high-quality resources for schools to help deliver this,

and | would like to commend Martin Lewis and Young Money for making this

new textbook available.


if


~


Minister of State for School Standards,
the Rt Hon Nick Gibb MP


Statement from Sharon Davies, CEO of Young Enterprise
(Young Money is part of Young Enterprise)


Developing knowledge, skills and attitudes in relation to money and personal finance
from an early age enables young people to make more informed financial decisions,
making the most of the opportunities they are presented with and avoiding some

of the pitfalls that they will undoubtedly have to navigate. We are extremely proud

to add this textbook to the range of tools and resources from across the sector, all
aiming to support the crucial development of financial capability of young people.

A huge thank you to Martin Lewis OBE, who enabled this to happen, and to teachers
and educators across the country for your efforts in improving the financial capability
of a generation of young people.


Sharon Davies,
CEO of Young Enterprise


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OUNG
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Part of Young Enterprise


YOUR MONEY
MATTERS


About Young Money


Young Money (part of Young Enterprise) supports all educators in developing the financial
capability of the young people they work with. We are a trusted and valued provider of
knowledge, resources and training to anyone teaching children and young people how to
manage money.


We offer schools free resources and support to make teaching financial education easy. We
know that every school and college is unique and needs to find its own solution to meeting the
needs of its learners.


We believe that trained teachers provide the most effective and sustainable route for financial
education in schools as they know their pupils best and understand how to integrate financial
education into lessons and meet the requirements of their school curriculum.


Please visit us at www.young-money.org.uk to get ideas, inspiration, advice and to access
our full range of resources and services.


Contact


Young Enterprise
The Coram Campus
41 Brunswick Square


London
WCIN 1AZ


T. 0207 549 1980
E. info@y-m.org.uk


Follow us on twitter @YoungMoneyEdu


Young Enterprise is a registered charity. Registered number 313697
Incorporated in England as a Company Limited by Guarantee No. 712260


YOUR MONEY MATTERS


CONTENTS


9 HOW TO USE THIS


TEXTBOOK
11 SAVING
12 Savings
15 Interest


20 = Savings accounts

24 Ways to save

28 Money and mental health
29 What have you learnt?
30 Further your knowledge


33 OF YOUR MONEY

34 Spending

38 Ways to pay

40 —_— Budgeting

43 Keeping track of your budget
45 Value for money

48 Know your rights

49 ~~ What have you learnt?

50 ‘Further your knowledge


53 BORROWING


54 Borrowing and debt

56 Repayment, interest and APR
60 ~=Making informed choices

62 Borrowing products


70 Manageable and
unmanageable debt


71 What have you learnt?


72. Further your knowledge


75
76
76
78
79
81
82
84
87
88
89
91
94


95
96


92
100


102
103
104
106
110
112
115


117
118


MOVING ON FROM
SCHOOL - THE WORLD


Next steps: apprenticeship
Next steps: employment
Next steps: university
Student finance

Earnings

Payslips

Tax and National Insurance
Self-employed

Methods of payment

Why do we pay Income Tax?
Pensions


Help for people on low
incomes


What have you learnt?


Further your knowledge


RISK & REWARD


Types of personal
financial risk


Attitudes to risk
Assessing risk
Investments
Gambling
Protecting yourself
Types of insurance


Other forms of protection
against financial risk


What have you learnt?


Further your knowledge


121
122
123
125
126
127
131
132
134
136
137
138


141


SECURITY & FRAUD


What is fraud?

Identity theft

Key terms

Fake emails

Online fraud

How to protect yourself
Online security

Help available

Money mules

What have you learnt?

Further your knowledge


GLOSSARY


YOUR MONEY MATTERS


HOW TO USE


Welcome to Your Money Matters. This book will help you make informed choices about managing your money,
now and in the future.


There are six chapters on topics that are relevant to you. Each starts with a question, which the information
included in the chapter will help you answer.


In each chapter, you will find:


INFORMATION WHAT HAVE YOU LEARNT?


Tl The information icon highlights key and Each chapter reviews learning with a ‘What have you
useful information on the chapter topic. learnt?’ section, which includes summary activities
and case studies for you to complete, drawing on the
DID YOU KNOW? knowledge you have gained throughout the chapter.
| Look out for these icons, which will give
o interesting facts on the subject area. FURTHER YOUR KNOWLEDGE
At the end of each chapter, there is an additional section
\ ACTIVITY which includes further and more detailed information
The pencil icon indicates there is an about the subject area, and extension activities to stretch
<< activity for you to complete to help build your learning.


your knowledge and understanding of the
information you have read. ¥


\ DISCUSSION
The discussions provide an opportunity for


to you talk to your classmates about the
topic areas and give your opinion on key
information within the chapter.


CASE STUDY


The case studies let you examine real-life


situations in more detail and decide what
you think the best course of action is.


QUESTIONS


You will find questions at the end of each


section. The questions are an opportunity
for you to apply the knowledge you have
gained through reading the information
and check your understanding.


MATTERS


SAVING


SAVING


IS IT IMPORTANT FOR ME
TO SAVE MY MONEY¢


In this chapter you will explore the reasons that people save money,
and how to compare the range of saving options available.


You'll see how saving is an important way of reaching future financial goals, and how individual choice is
important in making those decisions.


By the end of the chapter, you will know what your main options are for saving your money and be able to make
comparisons between them. You'll be aware of some of the main features and perks that can come with savings
options, and how to take these into account in your decision making.


a) DID YOU KNOW?


There are over 300 banks and 45 building
societies registered in the UK. All provide a wide
range of savings options for customers.


SAVING


SAVINGS


SAVINGS
SAVING OR SAVINGS®


It is easy to confuse the terms saving and savings.


Saving is often thought of as the act of putting away
money for future use. This might range from a few
pence being kept in a money box at home to a larger
amount being placed in a bank account.


Saving can also refer to reducing the amount you
spend, maybe allowing you to put some of that money
away for future use.


Savings refers to the amount or value of the money
that is being put to one side. If you have put £50 into a
bank account this is your savings. If you then arrange
to put in a further £10 per month then that is the
amount you are saving. In this example, at the end of
1 year you would have saved a further £120 (£10 x

12 months) on top of the initial £50, giving you a total
savings amount of £170 altogether. This is the amount
that is said to have accrued.


Reasons to save:


¢ For a very specific purpose or to help achieve a
particular goal.


* To gather together wealth for future use.
* To put money aside for unplanned events.


* To keep your money safe.


DELAYED
GRATIFICATION


When you save money, it is likely that you will spend it


at some point in the future. That could be either in the
next few days or weeks (short-term saving) or within the
next year (medium-term saving). It may even be much
further into the future (long-term saving) — for example,
when you are saving up for somewhere to live or even
thinking about retirement. In some cases, the money
you save may be passed on to others through gifts,
donations to charity or inheritance.


Saving for future spending is sometimes called
“delayed gratification” — in other words, we postpone
the sense of enjoyment we get from immediate
spending to sometime further into the future. But
remember, the money can only be spent once, so the
choices you make about how to spend your savings
should be made very carefully.


Saving can bring its own sense of satisfaction — if you're
saving on a regular basis and can see your savings
increase as you move towards your target amount.


2) ACTIVITY


1. Sam currently spends all of his £5 pocket money
every week on a music streaming subscription.
There is currently an offer to make a one-off
payment of £80 for a whole year of streaming.
a) How many weeks will it take Sam to save up

the money for the one-off payment?
b) How much would Sam save over the year?
¢) Do you think it is worth the wait to save up
for the one-off payment?
d)What might the disadvantages be?


2. Jakob has saved up for a new game to play
on his console. He can buy it online now for
£40, plus £5 postage and packaging, or he
can wait 3 months, save a bit more and buy the
downloadable version, which will have added
features and levels, for £55. He can only spend
the money that he’s saved up once, so needs to
decide what to do.
a) Identify the benefits and implications of

each option.

b)In your opinion, should Jakob delay buying


the game? What would you do?


WAYS TO SAVE


The simplest way to save is to put some cash to one
side at home. This is usually fine for small amounts but
becomes increasingly risky as the amount of savings
becomes larger. Cash in the home is at risk of being
stolen or lost, and it can be difficult to keep track of
exactly how much you have in order to know if any is
missing. That’s why many people choose to keep their
money in a safer place such as a bank, building society
or credit union.


ap DID YOU KNOW?


Banks, building societies and credit unions
are all organisations that provide financial
services, including the ability to save, but are
structured differently.


A bank is an organisation owned by its
shareholders. It aims to maximise profits for its
shareholders through its financial activities.


A building society is an organisation that is owned
by its members, some of whom will be customers


who save money with or borrow money from the


society. They often offer a range of financial services
and are similar to banks.


Credit unions are community focused, non-profit
making organisations that encourage saving and
lend money to members. To use a credit union, you
have to become a member.


There are now many mobile apps like
Chip, Plum, Monzo and Tandem that can


Some of them analyse your spending patterns and
decide if you have enough left in your account to
be linked to your bank account. They help
you to save by rounding up payments
made, using the app, to the nearest pound
and saving the extra money for you.


TYPES OF ACCOUNT


There are two main types of account which can be


save. If you do, they move it to a savings account
for you. Many of the large banks also now offer
auto-saving schemes to customers with current and
savings accounts when they make payments using
a debit card.
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