How do you teach a young person about money?

Pocket money, bank accounts, savings that already exist, and the first wage packet

Almost everything an adult knows about money was picked up before they turned eighteen, usually without anyone announcing that a lesson was happening. A shopping list gets written at the kitchen table. Someone says no to a second thing in the shop and gives a reason. A young person who has moved home more than once may have missed a lot of that, not because nobody cared but because the household around them kept changing.

This is one of the quieter parts of fostering. It rarely comes up at an open evening and it almost never appears in a recruitment advert. It is also one of the very few things that the rules governing fostering in England name out loud, and one of the few where a foster carer can hand a young person something that lasts long after they have stopped living with you.

Here is what the law expects, what the practical shape of it looks like at seven and at seventeen, the two savings accounts that a lot of carers have never heard of, and the conversation about criminals recruiting teenagers that we would rather you had early.

It is written into the standards, in one line

The Fostering Services: National Minimum Standards set out what every fostering service in England has to deliver. Standard 12 covers growing up and moving towards adulthood, and its first paragraph lists what children should be supported to do. One of the items on that list is short and unambiguous. Children are supported to:

“develop financial capability, knowledge and skills”

The same paragraph goes on to say that children should know what financial support they will be entitled to once they are living independently. Standard 12 also expects the fostering service itself to have proper arrangements in place for getting young people ready, rather than leaving it to whoever happens to be caring for them.

A quick note on wording before we go further. The standards and the statutory guidance call a child’s home a placement and call a young person who has grown up in care a care leaver. Neither of those is how children describe their own lives, so where we quote a document we have kept its words, and everywhere else we have used plainer ones.

The Department for Education’s own guidance on planning for adulthood, revised in February 2025, is blunter than the standards are. It says that how young people access and manage their personal finances “will be a major factor determining whether they will be able to” settle successfully into adult life.

That guidance also requires the plan for an older teenager to record their money management capacity and the strategies being used to build it, and it says the information has to be genuinely up to date before anyone moves to more independent accommodation. In other words, somebody is going to be asked what this young person can actually do with money. Most of the time, the person who knows is their foster carer.

Pocket money, and why nobody will tell you the right amount

Standard 2 of the National Minimum Standards is about a child’s individual needs. Paragraph 2.7 says:

“Children receive a personal allowance appropriate to their age and understanding, that is consistent with their placement plan.”

So a child in foster care is entitled to money of their own. What the standards will not do is tell you how much. There is no national rate, and The Fostering Network, the sector’s main membership body, publishes none and says so explicitly. Local authorities set their own guideline figures, agencies vary, and the plan agreed for one child may differ from the plan for another child in the same house.

That sounds unhelpful. In practice it is freeing, because the amount matters far less than four other things:

• It arrives when you said it would. A young person who has lived through a lot of broken promises is testing the reliability, not the figure. Pay it on the same day every week, even in a week that has gone badly.
• It is genuinely theirs. Money that can be taken away as a punishment is not pocket money, it is a behaviour chart. Keep the two apart.
• They are allowed to waste it. The whole value of practising at eleven is that the worst outcome is a bad week. The same mistake at nineteen costs a tenancy.
• Everyone knows what it is meant to cover. Write it down. If bus fares come out of it, say so before the first week, not after an argument in the second.

Worth agreeing with your supervising social worker early: what the child’s plan says, whether the amount steps up on a birthday, and who tells the young person if it changes. Recording what you agreed is also part of the job, and we have written separately about what foster carers have to write down.

A rough shape, by age

No two children arrive at the same place at the same age, and a fourteen year old who has never been trusted with a five pound note may need to start where a seven year old starts. Treat the following as a sequence rather than a timetable.

Primary school. Small amounts, handed over in coins rather than transferred to an app, so that the money is a physical thing that runs out. Let them pay at a till. Let them choose badly.

Ten to thirteen. Introduce waiting. A monthly amount instead of a weekly one teaches more in four weeks than a year of weekly pocket money, because it is the first time they have to make something last. This is also the age to open an account they can see the balance of.

Fourteen to fifteen. Hand over a category. Clothes is the usual one. Give them the real annual figure, split monthly, and stop buying school shoes yourself. Expect the first two months to go wrong.

Sixteen and seventeen. Real money starts arriving from outside the house. This is the year for payslips, and for the arithmetic behind a phone contract that runs for two years.

The method that works is not a lecture. Social workers and trainers tend to describe it as I do, we do, you do: you do it and narrate what you are doing, then you do it together, then they do it and you stay quiet. The quiet part is the hard part.

The bank account

MoneyHelper, the free service run by the government’s Money and Pensions Service, points out that a children’s savings account can be opened with as little as £1 for any child under eighteen, and that children over the age of seven can usually operate an account themselves, paying in and taking out.

Current accounts with a card attached are a separate matter, and banks set their own minimum ages and their own rules about who has to sign. Do not assume. Ring the bank or read the product page before you promise a young person a card.

The real obstacle for a child in foster care is almost never the bank’s age policy. It is identification and the question of who has authority to sign. A young person may not hold a passport. Their birth certificate may sit in a file at the local authority. Somebody has to establish an address history for a child who has lived in three places in two years. None of that is insurmountable, but all of it takes weeks, so start it long before the account is needed.

Ask your supervising social worker to raise it at the next review rather than waiting until the week a first wage needs paying somewhere.

The savings account they may already have, and nobody has mentioned

This is the section most carers tell us they did not know about.

The Junior ISA for children in care

The government funds a savings scheme specifically for children growing up in care, administered by a charity called The Share Foundation, which was authorised by government to set up and run the accounts. A child qualifies if they have been continuously in care for at least a year and do not already have a Child Trust Fund. The government pays in an opening contribution of £200.

Three things about it are worth knowing:

• Anyone can add to it. A relative. A former carer. A grandparent who has never been sure what else to offer. The overall Junior ISA limit set by HMRC is £9,000 in the 2026 to 2027 tax year, which is far more headroom than most accounts will ever use.
• The money belongs to the young person, not to the local authority. Nobody can take it back.
• They take control of the account at sixteen but cannot withdraw anything until they are eighteen. That two year gap is a gift, because it gives you a real account with a real balance to have real conversations about, with no way for a bad fortnight to empty it.

The Child Trust Fund almost everybody has forgotten

Child Trust Funds were set up for every child born between 1 September 2002 and 2 January 2011. Do the arithmetic against a teenager in your house today and you will find that a young person who is currently fifteen, sixteen or seventeen sits inside that window. Many of them have an account, and a great many do not know it.

The scale of the problem is not small. In September 2023 the government reported that almost 430,000 people aged eighteen to twenty one had an unclaimed Child Trust Fund, worth an average of about £2,000 each. An eighteenth birthday is exactly the moment when two thousand pounds changes what is possible, and exactly the moment when nobody is watching to make sure it gets claimed.

You can search on GOV.UK to find out where an account is held. It is a fifteen minute job and it is worth doing at fifteen rather than at eighteen, because the young person may have moved on by then. Note too that having a Child Trust Fund is what makes a child ineligible for the Junior ISA scheme above, so finding out which one a young person has is the first question, not an afterthought.

Sixteen and seventeen, when the money gets real

Money starts arriving from outside the household at sixteen, and it arrives faster than most young people expect.

A student aged sixteen to nineteen who is in care is one of the groups the government calls a defined vulnerable group for the purposes of the 16 to 19 Bursary Fund. For the 2026 to 2027 academic year that bursary is worth up to £1,200 across a full year, though colleges assess what each student actually needs rather than handing out the maximum automatically. The guidance encourages colleges to pay it as travel passes, meals, books or equipment rather than as cash, so do not assume it will land in an account.

Then there is a first part-time job, which is where the abstract becomes concrete:

• A payslip, and why the number at the bottom is smaller than the number of hours multiplied by the rate.
• Tax codes, and the fact that being on the wrong one is common and fixable.
• What National Insurance is and why it appears before anyone feels old enough to care.
• The gap between being paid on the last Friday and rent being due on the first.

Sit down with the first payslip. Read it line by line. A young person who understands a payslip at seventeen is ahead of a large share of the adult population.

The conversation about being used

This one is uncomfortable and it matters more than any of the rest.

Criminals recruit teenagers to move stolen money through their bank accounts. The industry term is a money mule. Analysis published by the fraud prevention service Cifas and by UK Finance found that in the first six months of 2023 there were 17,286 cases on the National Fraud Database carrying intelligence of money mule activity. Of those, 3,881 involved people aged twenty one and under, roughly one in five of the total, and people under thirty accounted for around 64% of cases. Recruitment happens through social media and, according to that intelligence, in person “outside schools, colleges or sports clubs”.

The offer looks like easy work. Money lands in your account, you send most of it on, you keep a slice. The consequences are heavier than a teenager will guess:

• Moving criminal money is money laundering, and a conviction can carry a sentence of up to fourteen years.
• Banks close the account and share the marker between them, which makes opening another one hard.
• That closed account then blocks ordinary adult life, from a phone contract to a student loan payment.

Have the conversation before it is needed, not after. A young person who has been in care may be more vulnerable to this than most, for reasons that have nothing to do with judgement: less money, and fewer adults to check something with. There is sometimes also a strong pull towards anyone who treats them as useful. Say the words “if someone offers to pay you to use your bank account, the answer is no, and you can tell me without being in trouble” while nobody is offering anything.

When money means something other than money

Some of what you see will not respond to teaching, because it is not really about money.

A young person who spends every penny the day it arrives may have learned that anything kept can be taken. Giving money away can be a way of buying friendship, if buying it is what has worked before. Cash hidden around a bedroom usually means somebody once went without in a way you have not been told about.

And a young person who refuses pocket money altogether is often trying not to cost you anything, which is heartbreaking and very common.

None of these is a discipline problem and none of them improves if it is treated as one. What helps is noticing out loud without making it a confrontation, keeping the money arriving anyway, and telling your supervising social worker what you are seeing so that it goes into the plan rather than staying in your head. Patterns that look like bad habits are often information.

If a young person is heading towards living on their own, our post on supporting young people to develop life skills covers the wider set of things that sit alongside money.

What South Coast does alongside you

You are not expected to work any of this out on your own, and you are certainly not expected to fund it yourself.

Every South Coast carer has a named supervising social worker who knows the children in your home, and there is somebody on the end of the phone at any hour on 023 8235 2020. Questions about a child’s personal allowance, about who can sign a bank form, or about whether a young person has a Child Trust Fund all go through that relationship. You can read more about the support around a South Coast foster carer.

On the money side, our standard weekly payments are £479.50 for a child aged nought to ten and £507.50 for a child aged eleven or over, per week and per child, combining an allowance for the child’s everyday costs with a professional fee for your role. We also offer a council tax contribution. The full picture is on our fostering payments and allowances page, and because foster carers are treated as self-employed, it is worth reading how Qualifying Care Relief affects what you pay tax on.

If you are still working out what kind of fostering would suit your household, our guide to the different types of foster care is the place to start.

Frequently asked questions

How much pocket money should a child in foster care get?

There is no national rate. Standard 2.7 of the National Minimum Standards says a child should receive a personal allowance appropriate to their age and understanding and consistent with their plan, but it sets no figure, and The Fostering Network publishes none either. Local authorities issue their own guideline amounts, so ask your supervising social worker what applies to the particular child. Consistency and clarity matter considerably more than the number.

Can a child in foster care have their own bank account?

Yes. MoneyHelper notes that a children’s savings account can be opened from £1 for any child under eighteen, and that children over seven can usually run one themselves. Current accounts with a card have their own age rules, set by each bank. The practical hurdle is usually identification and address history rather than age, so start the process early and involve your supervising social worker.

What is the Junior ISA for children in care?

The government funds a Junior ISA for children who have been continuously in care for at least a year and who do not already have a Child Trust Fund. The accounts are set up and managed by The Share Foundation, a charity authorised by government to run the scheme, and the government pays in an opening £200. Anyone can add to the account, the young person takes control of it at sixteen, and the money can be withdrawn from eighteen.

Does the child’s pocket money come out of the foster carer’s own pocket?

No. The weekly payment a South Coast carer receives combines an allowance for the child’s care with a professional fee for the carer’s role, and the allowance is there to cover the child’s everyday costs. A child’s personal allowance is part of what that is for. If you are unsure how it should work for a particular child, ask us rather than absorbing the cost quietly.

Is teaching money something the fostering service is meant to do, or the carer?

Both. Standard 12 of the National Minimum Standards says children should be supported to develop financial capability, knowledge and skills, and it also requires the fostering service to have proper arrangements in place for preparing young people to live independently. The day to day teaching happens in your kitchen. The planning, the training and the entitlements sit with us and with the local authority.

A note on advice

This article is general information about fostering in England, current at the time of writing. It is not personal financial or legal advice. Savings limits, bursary amounts and tax thresholds change, so check the current figures on GOV.UK or with MoneyHelper before acting on them, and speak to your supervising social worker about anything specific to a child in your care.

A child isn’t just given a home, they’re given a chance.