The Importance of Teaching Financial Literacy to Youth
The Importance of Teaching Financial Literacy to Youth
0
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
During a recent outreach program at Penrhos College, Wealth Designers senior financial adviser Dawn Thomas asked a group of Year 9 students about the cohort with the least amount of superannuation.
To their surprise, the answer was not what they expected.
"Being kids, they threw out the most imaginative answer, which I've never heard before," Thomas tells Professional Planner. "They said babies."
While technically not incorrect, the correct answer is women.
"I explained that women retire with half the amount of superannuation that men do," Thomas says. "They were shocked and I asked them if they thought that was fair. They replied with a resounding 'No!'"
This presentation by Thomas and Horizon Group of Companies financial advisers Remo Venditti is part of a program aimed at teaching high school students about budgeting, financial goals, compounding, investing, and superannuation.
Addressing the Financial Literacy Gap
The Financial Advisers Association of Australia (FAAA) recognizes the importance of educating young people about financial literacy, according to FAAA general manager Anne Palmer.
"Teaching financial literacy to young people is incredibly important," says Palmer. "It sets them up for success in the future, not just financially but in every aspect of life. The foundation of any financial plan is understanding cash flow and budgeting."
Thomas agrees, emphasizing that even children can benefit from understanding their cash flow and budget. Starting the practice of saving for things instead of relying on debt at an early age is key.
"If they understand the benefits of long-term investing, it's really the world's their oyster," Thomas says. "Young people right now can give themselves a good start by equipping themselves with the tools to save and invest wisely."
The Talk Money Program
In response to the decline in youth financial literacy, Ecstra launched the Talk Money program in 2022, aimed at teaching children about financial literacy. Since its inception, the program has reached over 230,000 students through workshops conducted in schools across Australia.
Roadshows make up 17% of Talk Money bookings, allowing for concentrated time in regional areas across the country. While online workshops are available, the organization prefers face-to-face interactions for better student engagement.
About 24% of bookings in 2023 were repeat bookings, indicating the value that schools see in financial literacy education. External facilitators like Ecstra provide teachers with the confidence to have conversations about money in the classroom.
Ecstra is actively reviewing and improving the Talk Money program based on feedback received from schools and students, showing their commitment to evolving and meeting the needs of young learners.
Emphasizing Financial Literacy as a Life Skill
Anne Palmer and Tracey West, manager of the Ecstra Foundation, both believe that teaching financial literacy is a crucial life skill.
"It's one of the most important subjects young people will ever learn," says Palmer. "It sets them up for success not just financially, but also in all aspects of life."
West adds, "Financial literacy is a key skill that empowers individuals to make informed decisions about their finances and future."
By teaching young people about budgeting, saving, and investing, we equip them with the knowledge and tools to build a more secure and prosperous future.
Published:Friday, 17th Nov 2023 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
Investors seeking exposure to Australia's leading companies have a standout option in 2026. BlackRock's iShares S&P/ASX 20 ETF has been recognised as the Best Australian Shares Exchange Traded Fund (ETF) by Money magazine's 2026 Best of the Best awards. - read more
As Australia enters 2026, the property market continues to exhibit resilience, with certain states poised for notable growth. Recent research from property analytics firm Cotality indicates that 87% of surveyed real estate and finance professionals anticipate home prices to rise over the year, with nearly half expecting growth exceeding 5%. - read more
As 2026 unfolds, Australians are set to experience several significant financial reforms that will impact various aspects of their personal and business finances. Staying informed about these changes is crucial for effective financial planning and decision-making. - read more
Loan consolidation is a financial strategy that involves combining multiple loans into a single, more manageable loan with a unified repayment plan. By consolidating loans, individuals can streamline their finances, potentially lower their interest rates, and reduce the burden of juggling multiple monthly payments. - read more
Applying for a loan online has become a standard practice in today's digital world. It offers the convenience of applying from the comfort of your home, swift processing, and quick disbursements. However, the online loan application process is fraught with potential pitfalls that could hinder your chances of approval or lead to less favorable terms. - read more
Personal loans in Australia are a popular financial tool for managing various expenses, from consolidating debt to funding major purchases or covering emergency costs. - read more
