- Young people are most vulnerable: 16 to 25-year-olds make up 42% of the least financially literate members of the community.
- The importance of school programs: Since 2004, the use of school studies as a source of financial-literacy information has increased from 31% - 39%, reaffirming the value of school-based literacy programs.
- Benefits for individuals: The least financially literate members of our community suffered the worst effects of the global financial crisis in terms of job losses and reductions in working hours.
- Economic benefits for Australia: Boosting financial skills for 10% of Australians with poor financial literacy can create 15,000 new jobs and increase Australia's gross domestic product by $6.2 billion annually over the long term.
It’s obvious that teaching financial literacy in schools is essential both for our children and as a long-term investment for the country, but is there anything that parents can do themselves?
- Start early: As soon as your kids are old enough to show an interest in the ATM or the cashier at the supermarket, explain what you’re doing. Show them what $2 or $5 can buy.
- Put money in their hands: In our cashless society, it pays to actually show your children coins and notes. Test them on their names and denominations.
- Cultivate the saving habit: Encourage children to put loose change into a clear savings jar so they can see it grow. Open an account for your child and take them to the bank to deposit their savings.
- Pay pocket money for odd jobs: Rewarding your children with pocket money for small chores done around the house is a great way to show them that money doesn’t magically appear from ATMs, but has to be earned.
- The art of budgeting: Teach your kids how to budget. Give them a fixed amount of spending money each week and show them how much they can afford to spend each day to avoid running out.
As money becomes less tangible and more virtual, endowing children early on with financial skills is becoming increasingly vital. Giving children this education alongside their ABCs and arithmetic will not only protect their future, but could prove beneficial for the entire country.
For more tips about money and kids, head to The Beanstalk.
Things to know before you Can: This advice has been prepared without considering your objectives, financial situation or needs. Because of that, you should, before acting on the advice, consider its appropriateness to your circumstances. Terms and conditions for transaction and savings accounts mentioned are available here (PDF 660KB). Please read our Financial Services Guide (PDF 60KB).