Emojis, likes, personal hotspots, wi-fi and now PokeStops – say hello to the world of words for Gen Z.
While we might not be at the same level as our tech-savvy kids when it comes to digital literacy, this doesn’t mean we as parents or carers can’t educate them about financial literacy and instil good money habits that can set them up for life.
There’s no denying this generation born between 1995 and 2009 also are today’s spenders who want the latest gadgets and smartphone. As the cost of living continues to rise and property prices remain sky-high, our kids need the guidance to make it as financially responsible and independent adults.
There’s no shortage of research that shows women often have what it takes to be successful investors and wealth creators. A 2014 survey of adult financial literacy for example, found women are generally better than men at keeping track of their finances, and are less likely to be impulsive when it comes to managing their money.
However, with less super than men, longer lifespans and time spent out of work, women face unique challenges in making the most of their money, which is why it’s all the more important for girls to be educated in finance.
I’m doing my best to help my two young daughters in primary school learn enough about money to be equipped with the skills for financial empowerment as women. Here’s some easy ways you can help put your own Gen Z kids on the best financial path in life.
Three and four year olds
It is never too early to start teaching the money basics. Children as young as three can work with a ‘reward system’ where they earn stickers for performing tasks such as putting away their toys. At the end of the week, fortnight or month they receive a coupon representing a certain value which they can spend with their parent’s help.
Five and six year olds
Games like monopoly can help set a fun stage on which parents can start to discuss ways of making money through investing. What parents teach their young children about money may have some bearing on their financial success as adults.
Seven and eight year olds
Extend on the rewards system and start giving pocket money in recognition of consistently performing certain tasks, such as putting their dirty clothes in the laundry hamper and getting their school bag ready the night before. Have children segment their pocket money into ‘bank’, ‘savings’ and ‘spending’. Bank goes into their bank account for a rainy day, savings is for something they have identified they want but will take active savings to achieve and spending is for them to spend straight away, if they choose. Help children to physically deposit their money into the bank.
Nine and ten year olds
When the children start begging for a mobile phone or extra data, suggest that they do some odd jobs around the house and save for it themselves. Even take it a step further and make an agreement with them to match whatever they save, dollar for dollar. However it’s important when setting financial boundaries with your kids to stick to that agreement and follow through with it.
Eleven and twelve year olds
Help children in this age group learn how to open and operate bank accounts online and show them how they can bank and manage their pocket money.
Thirteen and fourteen year olds
One of the most important things parents impress upon their children of this age is to take care of personal security when it comes to finances. Discuss the importance of never divulging financial information, including passwords, either over the phone or via email.
Fifteen and sixteen year olds
Find out what is really important to the 15 or 16 year old in the house and help set goals and plans for achieving their dreams. Suggest they start putting some of their pocket money away for that much-desired item. Maybe even put their goals down in writing or cut pictures out of magazines depicting their goal, allowing them to be regularly reminded and motivated. Then work out a plan of how to get there, including saving and budgeting.
Of course, a great thing all parents can do for their children is to be good role models. Parents openly chatting about money decisions in front of the children is very positive as ‘little ears’ are often switched on and children are highly influenced by how they see their parents making money decisions.
*Jenny Cattach is an Authorised Representative of AMP Financial Planning Pty Ltd, ABN 89 051 208 327, AFS Licence No. 232706. Any advice given is general only and has not taken into account your objectives, financial situation or needs. Because of this, before acting on any advice, you should consult a financial planner to consider how appropriate the advice is to your objectives, financial situation and needs.
