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According to a financial education study by the Organisation for Economic Co-operation and Development (OECD)*, at least 50% of students on average are ready to save for something that they want to buy but can’t afford yet. 49% of students save each week or month, 20% save only when they have money to spare, and 22% save only when they want to buy something.
These statistics are clear indicators that while youngsters have a general overview of what they would like to do with their money, we must empower them to build healthy money habits. Here are a few tips on how we can arm the next generation with information that helps them navigate their life better.
Start when they’re little
How many of us are guilty of not educating our kids about money and its importance? I’m sure we’ve all brushed it off saying they’re kids, and they can learn all this later. However, seeing that many schools don’t have a separate curriculum for personal finance education, kids learn these skills much later than when they need to and by then it’s too late.
Give them their financial freedom
You don’t have to go all out and give your kids a long lecture about how to manage their money effectively. Kids learn better when the teaching is practical so start by giving them an allowance. Of course, the first-time kids get money, they’re gonna want to spend it on their favourite things - let them! Eventually, once they’ve run out of all their money, they’ll come to you and ask you for tips on how to ensure they can retain it till the end of the month. It’s the perfect opportunity for you to understand their spending habits early on and shape the way they should be using their money for their benefit.
Introduce the concept of earning
This one’s self-explanatory. Reward your kids for doing chores around the house while you sit with your feet up 😉 It’s a win-win situation where they’re happy to get extra money for spending and you get your much-needed break. As an added bonus, they’ll learn to be independent, which means more free time for you!
Liv Young and break free
With a rapid digitalization of the financial industry, the younger generation has become the key demographic that will grow up to see the full-blown effects of a fintech revolution. Today’s kids are tomorrow’s future, and so it is becoming increasingly important that we encourage the youth to immerse themselves in the world of digital banking and learn good financial decision-making skills early on.
We’re taking a small step in creating an avenue for kids to spend and track their spending effectively. Introducing Liv Young - our new digital banking service for kids aged 8-17. Once parents open a Liv Young account for their kids through their own Liv app, they can transfer their kids’ monthly allowances to them, assign chores and reward them accordingly and have a complete overview of their kids’ financial habits. With their own debit card, they can get different offers with participating merchants and most importantly, financial independence.
“It’s never too early to start teaching your children about money. In fact, one big mistake parents make is starting too late” - Warren Buffett.
