Importance of financial skills

In an ever changing economy we all know the importance of being smart with our money and having financial goals. But how much of this knowledge do we pass down to the young people in our lives?

We teach young people complex maths equations but leave out the basics on how they can start setting budgets, We give them pocket money but perhaps don't spend 10 minutes brainstorming with them where they are thinking of spending it. Not to control or tell them what to do, but to start shaping their understanding on what is important to them.

Recently, I had the pleasure of arranging a visit from year 9 students into my workplace. The session was filled with number of activities, one of them being financial skills jenga.

The world of banking and finance may seem boring or unrelateable to a group of year 9 students so I had to find a way to make it fun but also provide learnings which the students could take away and apply to their own lives.

The students were split into groups and I read out a set of life events (losing a job, health challenges, getting married, taking a training course, etc) and they had to decide whether the events would positively or negatively impact their financial situation.

What followed really surprised me, the students engaged in thoughtful discussions and thought about each scenario critically. They were even able to argue both sides in some scenarios.

The awareness of finance was definitely there but there were also some gaps.

Gaps around:

1) What funding is available for higher education - this is critical awareness if we want to make higher education accessible to all.

2) The power they have over their finances - at that age naturally parents play a huge role in managing young people's finances but opportunities for young people to take charge of their money can be incorporated. Empowering them to take decisions which benefit them.

3) The importance of budgeting - at that age it isn't necessarily about getting them to budget, they should be able to have fun and have freedom rather than worrying about saving all the time. However, an awareness of what budgeting is and how it can help them could go a long way in helping them think about the future.

They key is to start building the knowledge around finances so as they start growing up they know the importance of it. It starts by gentle conversations, getting them to explore what they like to spend their money and how they think they can build towards small financial goals.