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After many years or working with hundreds of student's parents I have come to the conclusion that whether a student will suceed and have an enjoyable experience of learning an instruments lies mainly in your hands!!  It is essential that parents take an active role in their childs music education, just paying the bill and dropping them off is not enough, especially with younger students!  Your children will thrive musically if you can create the right routines for practice, stay in regular communication with their teacher, make sure they have done their theory homework and practiced what was set, and most of all enjoy listening to them play.  However, do NOT become the pushy parent, the extreme version of whom ties the child to the piano, hangs over their shoulder at lessons, pushes them into every exam and recital.  Always be aware of what is appropriate for their age level and that music is ultimately about entertainment and should be FUN!!  So here are some specifics to think about:
IS MY CHILD READY TO LEARN AN INSTRUMENT?  I think it is usually best for children to have shown some sort of interest or desire in playing an instrument before you contemplate beginning lessons.  However children who have older siblings who play will know what to expect and may just assume that its part of life for them to play too!  It is important that your child is old enough to understand that it will take a LOT of lessons before they can play the instrument, old enough to physically hold or work with the instrument comfortably, and with enough attention span and understanding to cope with the lesson.  Although the Suzuki method starts with pre-schoolers, I am unconvinced that there is any value in the under five's playing an instrument.  There is too great a risk of putting them off because its beyond there capabilities of co-ordination, attention and emotions and progress is so slow that others starting later will usually overtake them anyway!  I personally like to teach from six up, once they have adjusted to school and are reading and writing a little, 7 - 9 is I think an ideal age to begin.  If you have a pre-schooler who does seem very musical then try to find a general music class that is tailored for this age group that uses dance, movement, playing instruments and singing to teach all kinds of different music ideas such as loud and soft, slow and fast, etc  Listen to lots of different kinds of music with them and take them to see short appropriate performances, building a broad musical foundation for when instrumental teaching begins later!
HOW WILL PRACTICE FIT INTO OUR FAMILY ROUTINE?  It is essential that you have this worked out BEFORE you being lessons!  Even a beginner needs to practice for a minimum of 20mins at least 5 days a week.  You need to find a time when you are able to listen and help if necessary, when there isn't conflicting TV or other noise, etc.  If you don't start this from day 1 and stick to it you are setting your child up to fail, without practice and assistance from you  they will quickly think they aren't very good or very musical.  Likewise, it is essential that you attend EVERY weekly lesson.  It is so unfortunate when students miss several lessons in the term through no fault of their own and then again blame themselves as not being "good at playing the piano". 
DO I NEED TO ATTEND THE LESSONS?  You wouldn't expect your child to learn to read and write with just a 30min lesson once a week and no help at home!!  Especially fo the under 10 year olds it is essential that you attend at least most of the lessons and take notes so that at home you can help them practice.  Parents are often a little nervous about this if they haven't had a music education themselves, but remember adults learn much more quickly than small children, so you will easily keep a step ahead of them to begin with.  As the students become more confident in their music skills and as they grow older the role of the parent may shift more to that of a coach or encourager.  Even the teens need someone to take an interest in what they do (even if they say they don't!).  With older students sit in once and a while and/or pop in at the end of the lesson to talk to the teacher, check the notebook to see what needs to be practice, and always let your child know how much you enjoy listening to them practice!
HOW CAN I COPE WITH SIBLINGS DURING THE MUSIC LESSON?  Many of the children I teach have younger brothers and sisters who come along to the music lessons.  It can be hard to entertain younger children, especially pre-schoolers, during your childs lesson.  But it is essential that you as a parent attend lessons and this often means that little ones have to come too.  The positive side of this is that the younger children are exposed to both music and the culture and enviroment of music lessons.  I love hearing a young one in the background singing along quietly to familiar songs or having a music themed book read to them.  Before the first lesson prepare the younger children, explaining as much as is appropriate for their age of what will be expected.  i.e. how long the lesson will be and that they will have to stay relatively quiet and still (no easy task I know).  If the teacher doesn't provide books or toys you may like to take a book to read or a special toy to play with that they don't have every day at home.  Keep in mind that some toys are quieter than others.  Avoid overstimulating toys that encourage a more active response from your child.  If the lesson is soon after school you may want to keep afternoon tea to have at the lesson, this can take up 10mins of quiet eating.  Sometimes it is necessary to go for a short walk, at least you will have been present for most of the lesson.
As a teacher I provide for parents a corner of the room with comfortable seating off to one side of the room.  Keep in mind that most children are used to a school working environment without parents present and so listen, observe and ask questions if you need to, but give them a little space.  I also provide a variety of books on music themes from picture books up to adult texts and pens, paper and music based quizes and colouring in.
Always keep in mind that children are used to having their distracting brothers and sisters in the background and working in a classroom environment so they don't need complete silence to work.
WHAT KIND OF TEACHER DO I WANT FOR MY CHILD & WHAT KIND OF MUSIC DO I WANT THEM TO LEARN?  Firstly it is important that the teacher you choose for your children is someone that you are comfortable with and that both you and the children feel they can relate too.  Talk over your reasons for wanting the children to learn an instrument and discuss with prospective teachers what methods they use, their ideology of teaching and what your goals for the children are.  The right teacher for a child who is very goal focussed and likes to achieve well and enjoys performing in front of others, may not be the right teacher for a child who is interested in expressing themselves through creative composition and experiencing different kinds of music.  You may also find that many teachers are more flexible than you think and that if you communicate openly with them they will be able to design a programme to suit many different childrens needs.  However, it is also essential that you llisten carefully and draw on the experience of the teacher and always allow them to point out key elements that are essential to any musical development, such as theory and technical development! 
THINGS AREN'T GOING AS EXPECTED, SHOULD I CHANGE TEACHER?  Don't be in too much of a rush to change teachers as many changes will be detremental to your childs musical development.  It takes a teacher several months or more to really get know where your child is at musically and also to build a good relationship with them.  If your child is getting bored, or has interests in areas that aren't being developed (e.g. composition, improvisation, etc) or would like to play a different style of music, it is essential that you talk this through as soon as possible with theteacher.  You should also regularly communicate with the teacher about any concerns you have about lack of progress, what goals are being set for your child and by what standard they are being assessed (especially if exams aren't being taken the teacher should have some syllabus or plan they are working to).  In most cases if you talk these issues through with the teacher they can adjust their plan accordingly.  Be prepared also to listen if they have a good reason why they aren't willing to change some or all of what you are suggesting, especially if it relates to needing to still cover key elements or whether the student is ready for a higher level or exam.  If your teacher doesn't seem flexible and you are unsure of the validity of some of their reasons or methods then get a second opinion from another teacher or a parent who has some musical background and children who are futher along, or even from somewhere like an examination board parents forum.  Above all else, encourage your child communicate freely with you about what they think of their music lessons but never criticize their teacher to them or let them know you have concerns as this will undermine the teaching relationship and the childs faith in their teacher as a musician and therefore one of their key role models in this area.  If you do decide after this that a change of teacher is necessary take time to find the right one and be prepared to wait on a waiting list.  You may not want to give notice with the current teacher until you know you have a place with a new teacher.  Two big don'ts - 1: DON'T force your child to go to lessons if they are really hating it and don't like the teaher, this could put them off permanently.  2: DON'T continue to take your child for lessons term after term if they don't seem to be making much progress.  Talk to the teacher about this and if they can't remedy it then do change teachers before poor practice habits and low expectations make it hard for another teacher to turn the tide!
DO WE HAVE AN ADEQUATE INSTRUMENT?  If your child is going to take music lessons they MUST have an instrument at home to practice on.  It is better to delay starting and save for an appropriate instruent than to have them try and practice the piano at grandma's or a neighbours, or on a poor quality instrumentetc.  Always seek advise from your teacher before buying an instrument!
Pianos: - Keyboards are fine for the first couple of years piano lessons as long as they are touch sensitive (which means they play loud when you press the key hard and quiet when you press the key softer).  Students should never be entered for an exam if they are playing on a keyboard at home.  The new digital pianos (like the Casio Privia) are different to keyboards and quite suitable for up to Grade 5 exam level, they have keys that are action weighted to feel like a real piano and have the same number of keys as a pinao and usually a built in pedal.  The advantage of these is that they are smaller, lighter to shift, don't need tuning, can be used with headphone (although don't allow this all the time because you need to know what is being practiced) and may also have some fun rhythms and sounds.    Digital pianos will cost a lot less new than a second hand piano that is still in adequate working order.  Beware, most older pianos from the 50's & 60's of English and German origins are wearing out fast!  You are better to use a keyboard or digital piano than a poor quality second hand piano that hasn't been maintained well.  Often these older pianos sell for very cheap, BUT some keys will likely be stiffer than others meaning your child can't develop an even technique, they will likely also be near impossible to keep in tune which is detremental to your child devleoping a good ear.  If you are going to buy a piano get advice from your teacher and from a qualified piano technician and tuner, preferably one that is NOT selling you the piano (unless your teacher has told you that they can be completely trusted to help find you the right piano).
Violins: -  Many of the cheap violin outfits available in the shops and on the net aren't set up correctly to make them easy to play and a few of the worst aren't worth spending money on to set up correctly!  Brands such as Kapok, Palatino, Cremona, Shim, and at the bottom end Skylark are all asian mass produced instruments that are of ok quality but will still need additional money spent to set them up correctly.  Avoid violins that are painted pretty colours or have no brand lables even if they are described on the internet as High Quality, there are so many different brands that your teacher may not know them all and I'm not going to try and list them!  Once you have bought a violin (new or second hand) take it to a local violin technician (Luthier) to have it set up properly, they will: change the strings if necessary (for a better sound), adjust the sound post (to get a better sound), shape the bridge (so it is easier to bow), plain the fingerboard (so that it doesn't make funny buzzing noises), fit the tuning pegs (so it stays in tune), fit fine tune adjusters if they are missing, and check the bow (a badly weighted bow will wobble and you may need to upgrade to a better one).  It is also essential that your have a good fitting and fully adjustable shoulder rest, I recommend the KUN brand as they work well and last well.  A child who has a violin that is uncomfortable to hold, makes funny noises and doesn't have a nice tone even when they are playing correctly won't bother with taking lessons for long! 
Other Instruments: - Again don't buy before consulting your teacher and be aware that any instrument that doesn't work properly or has faults in its original construction could create habits in your childs technique that are almost impossible to change even when they graduate to a better instrument.
HOW OFTEN SHOULD MY CHILD SIT EXAMS?  This is a hot topic with teachers and parents alike debating from every year to never, and everything in between!  I am concerned by both ends of the debate and settle clearly in the middle.  Firstly, to never sit an exam means that a student doesn't gain any of the satisfaction of success, let alone the certificate to be proud of.  Also many students who don't sit any exams and play just for fun have big gaps in their learning, sitting an exam does give a set standard and syllubs to test against.  Mock exams can be useful if a student really doesn't want to sit an exam or instead of a first exam, where all the work is prepared but the teacher gives the test and marks it themselves.  On the other hand I have taken on many students who are bored and exhausted after doing exam after exam with no real time to learn new things in between.  They often have a very limited musical understanding and don't really seem to get much enjoyment out of playing.  These students have also often got into the habit of taking all year to learn 3 pieces with the help of a teacher and are hardly capable of picking up and playig other songs with any independent learning.  I have met many adults who later in life can play some of these exam pieces and nothing else! What a waste!  So, I opt for the middle ground.  Most of my students will sit an exams every 2 or 3 years (you can skip grades!) maybe starting with grade 2 and then doing grade 4 about 3 years later.  It is absolutely essential that students are only entered for exams they are ready for and will pass well and how often I put them in for exams and at what age will depend largely on the students personality, some are far more goal oriented than others and for some exams are just a nightmare of fear!  For those that really find performance scarey I usually get them to do a couple of Theory exams first and a few mock exams.  However, whether my students are sitting exams or not they all move through the grades learning the scales, technical work, some similar pieces, sight reading, ear-tests, etc  It is important to make sure that your childs teacher is covering all the key elements that would be tested if an exam is to be taken at a later time.  When your child sits an exam should be a join decision between yourself, the teacher, and the student, however keep in mind that the teacher is the one entering the student for an exam and you should never ask them to enter a student they are not completely confident is ready! 
If you have a questions relevant to parents that I haven't answered here please e-mail me.  I will answer your questions personally and also add a more general answer to this section for others.