Good financial education should give children real life experiences. Setting up a school savings club is a great way of making looking after money real for pupils, reinforcing theoretical knowledge with practical learning.
Savings clubs are a schools-based activity whereby pupils are offered the chance to deposit and withdraw small amounts of money on a regular basis, usually in partnership with a local credit union (or community bank).
Savings clubs give pupils practical experience of handling money, helping to foster a savings habit and other good financial habits from an early age. The important thing is not the amount that is saved but the fact that pupils save a little regularly. Pupils should be encouraged to save for a purpose, rather than just for its own sake. The LifeSavers programme also encourages schools to involve pupils in running the savings club as junior cashiers or bank managers, under the supervision of adult volunteers.
Savings clubs are not a new idea. LifeSavers seeks to build on best practice from small-scale schemes across the country, by opening up this opportunity to many more schools in a sustainable way, and by integrating savings clubs into a whole school approach to financial education.
There are many practical learning opportunities around using and handling money for pupils that come with joining and helping to run a school savings club:
“My mum says I spend money too quickly, so this will help me think about what I really want” year 5 pupil
LifeSavers can help you make the most of these opportunities, by providing guidance on how to run a successful school savings club and how to link this to our classroom teaching and collective worship resources as part of a whole school approach to financial education.
“My money at home always gets lost and in school club it won’t” year 2 pupil
Every savings club is operated slightly differently, depending on what is agreed between the school and the credit union. However, there are some features that are common to well-run savings clubs, and that we would recommend to schools that are considering setting up their own savings club:
“Training our older students to run the savings bank was a brilliant opportunity for responsibility which they have risen to.”
LifeSavers can help you to work through the practicalities of setting up a schools savings club, with the help of our Savings Club Handbook (coming soon). Our financial education resources and free CPD training offer will help you to incorporate the savings club into a coherent programme of financial education for your school.
Central to many school savings clubs in schools is the partnership with a local credit union. So it’s important that everyone involved with the savings club understands what credit unions are and how they operate.
Credit unions are a type of local, community bank. Like banks, they offer a range of financial services, primarily savings and loans. Unlike banks, credit unions operate as a financial mutual, lending people’s savings out to other members. Any profit is redistributed among the members or re-invested in the credit union. To join a credit union, you have to fit within their ‘common bond’, which usually means living in a specified geographical area, or working for a particular employer.
Credit unions have a number of clear aims and values:
Credit unions are covered by the Financial Services Compensation Scheme, which means that members’ savings are protected if the credit union were to fail. Currently, over one million people in the United Kingdom are members of a credit union, including around 136,000 junior savers. Being part of the savings club means that pupils will become junior members of the credit union. When they reach adulthood (usually 16), they will be eligible to register as full members.
You can find a local credit union at www.findyourcreditunion.co.uk, but it is important to note that not all schools will have a credit union that covers their area, and that not all credit unions are equipped or have the capacity to support school savings clubs.