Helping children save: why goals matter

In today’s busy world, teaching our children about money is important. As parents or grandparents, we know saving for the future is key. And guess what? Goal setting is a big part of that. Let’s chat about why setting savings goals for children is so crucial and share some simple tips to help them get started.

Why goals matter:

Goals are like maps for our savings journey. They give children direction and purpose, teaching them to be smart with their money. Whether it’s saving for a “cool” toy or planning for college, goals help children learn how to make smart choices and feel proud of their achievements.

Easy ways to set and reach goals:

Start early: Get your children excited about saving from a young age. Try using piggy banks or jars to show them how saving works. You can even open a Junior Savers Account.

Make it real: Help children see their goals by making vision boards or drawings. It makes saving feel more fun and achievable.

Set SMART Goals: Show children how to make goals that are Specific, Measurable, Achievable, Relevant, and Time-bound.

Here’s how you can do it:

  • Specific: Clearly define the goal. For example, “Save £50 to buy a new toy” or “Save £20 to go to the movies.”
  • Measurable: Make sure the goal is quantifiable. You can track progress by keeping a chart or using a piggy bank to collect coins and notes.
  • Achievable: Ensure that the goal is realistic and within reach for the child’s age and allowance. Avoid setting too lofty goals that might discourage them.
  • Relevant: Tie the goal to something meaningful for the child. It could be saving for a desired toy, an outing with friends, or a contribution to a charity they care about.
  • Time-bound: Set a deadline for reaching the goal. For instance, “Save £20 in two months” or “Save £10 by the end of the month.”

Lead by doing: Children learn best by watching you. So, involve them in family money talks and show them how you save and budget.

Celebrate wins: Every time your children reach a savings goal, celebrate! It could be a small treat or just a big high-five. It helps them stay motivated.

Think ahead: While short-term goals are great, talk to your children about saving for big stuff too, like college or a car. It gets them thinking about the future.

Related articles:

4 fun and creative ways to teach children the art of saving money
A guide to raising financially savvy children
How to talk to your children about money
How to teach children develop good money habits
Unforgettable summer adventures: budget-friendly activities for kids in the UK

Jargon buster: What is a credit score and why does it matter?

What is a credit score?

Your credit score is a three-digit number. It’s calculated from the information a credit reference agency (CRA) holds about you. Your credit score usually comes with your credit report, which gives you more details about your credit history.

Lenders use your credit score, plus other information, to decide whether they will lend you money.

The better your score, the more doors open for you in the world of credit. Think mortgages, credit cards, or loans – the cream of the financial crop. And that’s not all – having a stellar credit score means you get the best deals in town. Higher limits, lower interest rates, great cashback etc.

Here’s a quick rundown on what those digits really mean:

0 – 550 = Very Poor
551 – 565 = Poor
566 – 603 = Fair
604 – 627 = Good
628 – 710 = Excellent

However, don’t let past slip-ups haunt you forever. We’re all human, and mistakes happen. Now, let’s talk about how you can give that credit score a makeover.

First up, keep tabs on your credit report. It’s like a real-time reflection of your financial health. Check it regularly, and if you spot any errors, don’t fret. You have the power to dispute them. And trust me, fixing these hiccups can do wonders for your credit score.

Being on the electoral register is another game-changer. It’s not just about voting; it shows lenders that you’re settled and stable. Whether you’re a student or a seasoned professional, make sure your address is consistent on credit applications.

Lastly, financial ties – they matter. Joint mortgages, shared bills, or acting as a guarantor can impact your credit score. Even if things change – relationships end or you move – it’s wise to keep an eye on your credit report to ensure it’s all up-to-date.

What is an emergency fund?

An emergency fund is a savings account that you set aside to cover unexpected expenses. These expenses can be anything from a car repair to a job loss to a medical emergency. Having an emergency fund can help you avoid going into debt or having to sell your belongings to cover these expenses.

How much should I save in an emergency fund?

A general rule of thumb is to save 3-6 months of living expenses in your emergency fund. This means that if you lose your job, you will have enough money to cover your rent, food, and other essential expenses for 3-6 months. However, the amount you need to save may vary depending on your individual circumstances. For example, if you have a lot of debt or have a high risk of losing your job, you may need to save more than 6 months of living expenses.

Where should I keep my emergency fund?

Your emergency fund should be kept in a separate savings account that is easy to access but not so easy to access that you will be tempted to use the money for everyday expenses.

How do I build an emergency fund?

The best way to build an emergency fund is to start saving small amounts of money on a regular basis. You can set up an automatic transfer from your checking account to your savings account, or you can make a point of saving cash every day or week. Even small amounts of money can add up over time.

Here are some tips for building an emergency fund:

  • Create a budget and track your expenses so you can see where your money is going.
  • Cut back on unnecessary expenses.
  • Set realistic savings goals.
  • Get a side hustle or sell unused items to make extra money.

Benefits of having an emergency fund:

  • Peace of mind: Knowing that you have an emergency fund can give you peace of mind and reduce stress.
  • Avoid debt: An emergency fund can help you avoid going into debt to cover unexpected expenses.
  • Better financial decisions: Having an emergency fund can help you make better financial decisions, such as saving for a down payment on a house or retirement.

Here are some examples of how an emergency fund can be used:

  • To cover the cost of a car repair
  • To pay for a medical emergency
  • To cover your expenses if you lose your job
  • To make a deductible on your insurance

An emergency fund is an essential part of any financial plan. By saving for an emergency fund, you can protect yourself from the unexpected and improve your overall financial security.

‘Do One Thing’ for financial wellbeing: Talk Money Week 2023

This year, Hertsavers Credit Union is excited to participate in #TalkMoney Week, an initiative encouraging individuals, stakeholders, partners, organisations, and businesses across the UK to inspire financial wellbeing by doing one thing. We believe that it’s the small steps that count, and we want to make some noise about it.

Our goal is simple: get everyone talking about money together.

1. Review your budget

Start with the basics by reviewing your budget. This is a small but powerful step in understanding your financial health. Take a closer look at your income and expenses to identify areas where you can save more.

2. Save automatically

Setting up automatic transfers from your checking account to a savings or investment account can make a significant difference. It’s an easy way to ensure you’re consistently saving for a rainy day or future goals.

3. Address your pension

Checking the address on your pension might sound minor, but it’s crucial. Ensuring that your pension information is up to date can prevent issues down the road and secure your financial future.

4. Talk to your children about money

Start financial education early by discussing pocket money and financial responsibility with your children. Teaching them good money habits from a young age can set them up for a more secure future.

5. Use financial tools and calculators

Take advantage of the free tools and calculators available on the MoneyHelper website. Whether you’re planning for retirement, managing debt, or setting savings goals, these tools can provide valuable insights.

6. Review subscriptions

Take a few minutes to go through your monthly subscriptions and cancel any that you no longer use or need. This can free up extra funds.

7. Shop with a list

Before going grocery shopping, create a shopping list and stick to it. This simple step can help you avoid impulse purchases and save money.

8. Negotiate bills

Contact your service providers, such as internet or cable companies, and negotiate for better rates. You might be able to lower your monthly bills.

9. Set up an emergency fund

If you don’t already have one, establish an emergency fund with a small initial contribution. Even a modest fund can provide peace of mind during unexpected financial challenges.

10. Sell unused items

Declutter your home and sell items you no longer need online or at a garage sale. The extra cash can be a great boost to your finances.

11. Plan meals

Plan your meals for the week, reducing the need for takeout or dining out. Cooking at home is not only cost-effective but often healthier too.

Why it matters

Talking about money may seem intimidating, but it’s essential. When we share our financial experiences, we make better decisions, strengthen relationships, and reduce stress. These small actions collectively create a financially educated and resilient community.

Financial wellbeing is about more than just money; it’s about peace of mind, opportunities, and security for yourself and your loved ones. By participating in #TalkMoney Week and doing one thing to improve your financial situation, you’re taking a meaningful step towards a brighter financial future.

Individual Voluntary Arrangement

What is an IVA?

An IVA, or Individual Voluntary Arrangement, is a formal agreement legally binding both you and your creditors. It’s court-approved, ensuring creditor compliance.

Advantages of an IVA:

  • Halts interest accrual and creditor pursuit.
  • Flexibility to include diverse debts.
  • Offers a structured repayment scheme tailored to your financial capacity.
  • Typically spans 5 to 6 years for monthly payments.

Disadvantages of an IVA:

  • Involves considerable setup fees.
  • May not be optimal for debts under £10,000.
  • Windfalls, like inheritances, might be utilized to settle debts.
  • Creditors can claim pre-IVA owed funds even after its conclusion.

Caution regarding Debt Management Companies:

  • Debt management companies provide debt assistance but often charge additional fees.
  • Opting for an insolvency practitioner independently can be a more cost-effective approach.
  • Always ascertain the fees charged by any debt management company before engaging their services.

In essence, an IVA is a powerful debt management tool, putting a halt to interest and creditor pressure. However, it does entail significant setup costs, making it less suitable for smaller debts. Considering an IVA warrants careful evaluation of its benefits and drawbacks. Additionally, exercise caution when dealing with debt management companies to prevent unnecessary expenses.

Please note that as a Credit Union we encourage you to contact your creditors and try to agree a solution within your budget before going down a route that could affect you for many years to come.

For more information, visit the Citizens Advice website.

Parent’s guide to financial wellness during back-to-school season

As the back-to-school season approaches, it’s time to prepare for the whirlwind of expenses that come with it. From uniforms to school trips, the financial strain can be overwhelming. But fear not, because in this guide, we’re going to help you navigate the back-to-school season with your financial wellness intact. Let’s dive in!

Create a budget game plan: Start by assessing your overall financial situation. Take a close look at your income, expenses, and any savings you might have. Once you have a clear picture, set a realistic budget for back-to-school expenses. List out all potential costs, including school supplies, clothing and extracurricular activities. Having a budget will help you allocate funds appropriately and avoid overspending.

Shop smart and early: Avoid the last-minute rush that can lead to impulse purchases. Begin your back-to-school shopping early to take advantage of sales, discounts, and promotions. Compare prices, and consider buying in bulk to save on essentials like notebooks, pens, and calculators. Shopping strategically can significantly reduce your expenses.

Prioritise needs over wants: It’s easy to get caught up in the excitement of new trends and styles, but prioritise needs over wants. Focus on essential items first, like school uniforms, stationery, and required textbooks. If your budget allows, then consider splurging on a few extras.

Explore second-hand options: Don’t underestimate the value of second-hand items. Check out thrift stores, online marketplaces, and community groups for gently used school supplies, uniforms, and even electronics. This can be a budget-friendly way to get what your kids need without breaking the bank.

Utilise school resources: Schools often provide resources like book rental programs or free school supplies for families in need. Don’t hesitate to inquire about such offerings, as they can significantly alleviate your financial burden.

Review your financial goals: The back-to-school season is an excellent time to revisit your long-term financial goals. Reflect on your savings, investments, and any outstanding debts. Adjust your financial plan to accommodate the additional expenses while staying on track with your objectives.

Involve your kids: Use the back-to-school season as an opportunity to teach your children about money management. Involve them in creating the budget, comparing prices, and making spending decisions. This hands-on experience can impart valuable financial skills.

Build an emergency fund: Alongside back-to-school expenses, consider building or bolstering an emergency fund. Life is full of unexpected twists, and having a safety net can provide peace of mind during financially challenging times.

Remember, the key to maintaining financial wellness during the back-to-school season is thoughtful planning and informed decision-making. By implementing these strategies, you can navigate this season with confidence, ensuring that your children’s education doesn’t compromise your financial stability.

If you need help with your finances, why not consider a Child Benefit Loan and Savings Plan from Hertsavers?

Here’s to a successful and stress-free back-to-school journey!

What is interest?

Interest is a concept that affects our financial lives on a daily basis. Whether you’re borrowing money, saving for the future, or investing, interest plays a significant role. In this blog post, we’ll explore what interest is, how it works, and why it matters to you.

How does interest work?

Interest is typically expressed as a percentage and is calculated based on the principal amount, which is the original sum borrowed or invested. There are two main types of interest: simple interest and compound interest.

Simple interest is calculated only on the principal amount. For example, if you borrow £1,000 with a simple interest rate of 5% per year, you’ll pay back £1,050 at the end of the year (£1,000 principal + £50 interest).

Compound interest, on the other hand, takes into account both the principal and the accumulated interest. It’s calculated based on predetermined compounding periods (such as annually, semi-annually, quarterly, or monthly). As interest is added to the principal, future interest is calculated on the new total, resulting in exponential growth over time.

Why does interest matter to you?

Understanding interest is crucial because it impacts your financial decisions. When you borrow money, the interest rate determines how much you’ll have to repay, so it’s essential to compare rates and find the best deal. On the flip side, if you’re saving or investing, the interest rate determines how quickly your money will grow over time. Higher interest rates can lead to greater returns, while lower rates may limit your earning potential.

In conclusion, interest is a fundamental aspect of our financial system. It affects both borrowers and lenders, savers and investors. By grasping the concept of interest, you’ll be better equipped to make informed decisions about borrowing, saving, and investing, ultimately improving your financial well-being in the long run.

Nurturing wise choices: The power of saying ‘no’ to children

As a parent or guardian, you may have experienced a plea from your child/ward to buy something that you hadn’t budgeted for. Here are some tips to consider:

Be empathetic and understanding: Start by acknowledging your child’s desire and show empathy towards their feelings. Let them know that you understand their want and why it is important to them.

Explain the reasons: Provide a clear and age-appropriate explanation of why you are saying no. For example, you can mention budget constraints, the item not being suitable or necessary at the moment, or other priorities that need to be considered.

Offer alternatives: Instead of simply saying no, offer alternatives that are more feasible or aligned with your values. This could involve suggesting a similar, more affordable item, or proposing an alternative activity or experience that could bring joy or fulfil their want in a different way.

Encourage saving and goal-setting: Teach your child the value of saving money and setting goals. Help them understand that if they really want something, they can work towards it by saving their own money or by setting goals to achieve it over time.

Stick to your decision: Once you have explained your reasons and offered alternatives, it’s important to be firm and consistent with your decision. Children need to learn that every want cannot be fulfilled instantly and that it is okay to experience disappointment or frustration.

Remember, it is essential to communicate with your child in a patient and understanding manner, encouraging open dialogue and helping them develop a healthy understanding of needs, wants, and responsible decision-making.

What is financial resilience?

Financial resilience is a crucial aspect of maintaining both financial stability and mental well-being. It refers to the ability to effectively cope with financial setbacks, adapt to changing financial circumstances, and sustain psychological well-being during times of financial stress. Developing financial resilience involves building a strong foundation of knowledge and skills to manage finances, as well as cultivating a healthy mindset and coping mechanisms.

Individuals with high financial resilience are better equipped to navigate unexpected expenses, job loss, economic downturns, or other financial challenges without experiencing overwhelming stress or negative psychological effects. They can analyse their financial situation objectively, make informed decisions, and implement strategies to mitigate the impact of setbacks. Financially resilient individuals also tend to have emergency savings, a diversified income, and a flexible budget that can accommodate fluctuations in income or expenses.

Moreover, maintaining psychological well-being during financial stress is crucial as it can impact overall mental health. Financial resilience includes developing a positive mindset, seeking support from loved ones or professionals, practicing self-care, and recognising that setbacks are temporary and can be overcome. By fostering financial resilience, individuals can cultivate a sense of control over their financial lives, reduce anxiety and stress, and improve their overall mental health and quality of life.

Financial planning for life events

Life is full of surprises and milestones, and some of them come with a price tag. Whether it’s getting married, starting a family, buying a car, going on holiday, or retiring, these life events can have a significant impact on your finances. Therefore, it’s important to plan ahead and be financially prepared for them. In this blog post, we’ll explore some financial planning tips for various life events.

Getting married

Getting married is one of the most exciting events in life, but it can also be expensive. From the wedding dress to the venue, catering, and more, the costs can quickly add up. Therefore, it’s essential to create a wedding budget and stick to it. You can also consider opening a joint account with your partner to save for the big day and other expenses you might have as a couple.

Starting a family

Starting a family is a big decision that comes with added responsibilities and expenses. The costs of having a child can vary, but it’s estimated that it can cost between £160,000 to £190,000 to raise a child from birth to age 18. Therefore, it’s important to start saving early and creating a budget to cover expenses such as diapers, clothing, education, and childcare. Hertsavers Credit Union offers a Junior Savings Account specifically for children, which can be a great way to start saving for their future.

Buying a Car

Buying a car is a big purchase that requires careful planning and research. You need to consider the type of car you want, your budget, and the financing options available. We offer a transport loan at a competitive rate to help you get started. Additionally, creating a budget for car-related expenses such as insurance, maintenance, and fuel can help you manage your finances more effectively.

Going on Holiday

Going on holiday is a great way to relax and unwind, but it can also be expensive. It’s important to create a budget for your trip and research the costs of flights, accommodation, and activities. You can also consider using a credit card that offers travel rewards or cash back to help offset some of the expenses. However, it’s important to pay off your credit card balance in full to avoid interest charges. We offer a Holiday Savings Account to help you save for your dream holiday.


Retirement is a significant life event that requires careful planning and preparation. You need to consider how much money you’ll need to retire comfortably and create a savings plan to achieve that goal. You can open a savings accounts that can help you save for the future, and it’s important to take advantage of any employer-sponsored retirement plans as well. Additionally, you can consider working with a financial advisor to help you create a retirement plan that meets your specific needs.

In conclusion, life events can have a significant impact on your finances, but with careful planning and preparation, you can be financially prepared for anything that comes your way. By working with a credit union, you can take advantage of their products and services to help you achieve your financial goals. Whether it’s getting married, starting a family, buying a car, going on holiday, or retiring, it’s never too early or too late to start planning for your financial future.