What should children be taught about financial skills such as saving and budgeting, and when should it start?
According to Mabs, the free national money, advice and budgeting service, the majority of young people, 70 per cent, learn about money from parents and family members, with 30 per cent learning on social media, mainly TikTok.
However they learn about money, it’s important that they do, not just for the sake of Ireland Inc but for civic society and for personal wellbeing too, a fact borne out by the launch last year of Ireland’s first National Financial Literacy Strategy.
Included among its objectives is to improve data on children and young people’s financial literacy, and to look at opportunities for increasing financial literacy in the school curriculum, from early education through to sixth year.
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That’s because, currently, less than six out of 10 adults in Ireland (57 per cent) meet the minimum OECD level of financial literacy.
That is worrying, given that the minimum level is defined as simply being able to manage your money on a day-to-day basis with ease, and to consider your long-term financial wellbeing.
It makes sense therefore to start as young as possible, with pocket money having long been the gold standard for parents who can afford it to teach their children the value of money.
But awareness can start even younger with games such as ‘shop’, followed by board games such as Junior Monopoly.
An Post’s savings books are another stalwart, often opened to stash Communion money. An Post now offers a digital Money Mate current account, for kids aged seven to 15, which helps them learn about savings and spending, and serves as an entrée to online banking.
Eoghan O’Hara, Ireland country head of Raisin Bank, a platform that gives (grown up) Irish people access to savings and deposit accounts across Europe, welcomes the financial literacy strategy, and believes there should be more focus on financial education in the school system.
Given the constraints the curriculum is already under, he believes core learning on this subject starts in the home, which is why the current poor financial literacy figures are so concerning.
Some online bank apps are helpful when it comes to budgeting, he points out, with vaults or wallets where youngsters can divide up savings.
“For adolescents, whether through bringing guest speakers to schools or doing Transition Year projects, it’s really important they understand how investing works and to break down the feeling that investing is only for the mega wealthy,” he says.
“In fact, it’s a world that has become democratised, through all the different providers and apps, because people can now get access to it with very small amounts. So, arming young people with knowledge of things like risk, diversity and taxation early on will make them more confident, educated investors.”
Without proper education, their guide is likely to be online content creators who may not have their best interests at heart.
Helping youngsters achieve proper financial literacy means they, in turn, will be more confident teaching their own children.
“Giving children an appreciation of the value of achieving something they want through saving goes a long way towards building good habits,” he says.
