As we celebrate our young people, COBA has zeroed in on ways to make sure your kids and teenagers have the right foundations to build wealth and financial security.
Young people are increasingly savvy when it comes to managing the digital world, and this year’s International Youth Day recognises and celebrates that.
The theme, ‘From Clicks to Progress: Youth Digital Pathways for Sustainable Development’, asks how we can harness the efforts of young people to solve global problems.
At a personal level, kids and teenagers can also turn their strong digital skills and knowledge towards building great money habits for the future. Here are five places to start.
Create a savings account
Making regular deposits into a savings account is a great way to learn about discipline and the power of compound interest.
Consider setting up a customer-owned bank account with your child or teenager to show them the rewards of saving regularly. Today’s apps allow customers to engage with the process in real time, which means they can watch their savings grow without having to wait for a statement.
Build a rainy day or emergency fund
A rainy day or emergency fund teaches kids that while unexpected things can happen in life, having a small buffer can sometimes help soften the blow.
Think about encouraging kids to separate their savings into different categories for different occasions, including one for surprise costs.
Look to super early
For working tweens and teens, retirement is usually decades away, which often means retirement is one of the last things on their mind.
However, building some awareness of super can help with general savings knowledge and long-term planning. A good start is making sure they’re paid the right amount of super if working and are not overpaying on fees.
Get budgeting
A budget helps differentiate between ‘wants’ and ‘needs’ and can be useful for teenagers and adults.
Consider working through budgeting apps with your kids and creating a savings competition or including them in the household budgeting.
Practice scam awareness
With scammers often using social media to find new victims, it’s worth having a conversation with the kids about how to spot a fraudster online, especially for young people looking to make extra cash.
One recent scam has involved getting people to ‘like’ videos on TikTok and has particularly targeted people who are looking for additional work or a side hustle, Scamwatch warned.
Red flags to watch for include promises of “guaranteed income and flexible hours” or offers that appear out of nowhere, including unsolicited WhatsApp messages, Scamwatch stated.
With a gentle nudge, young people can combine their digital skills with money awareness to build habits for life.