What Your Teens Need to Know About Money

Accountant Pete Burrows (Lower Russel and Farr) likes to highlight the universal importance of financial education.

Pete said it’s valuable to instill a sense of financial awareness in children, such as “money is not unlimited”.

Such a simple understanding can help children make informed decisions about spending and saving.

Understanding basic financial concepts and responsibilities is crucial for children starting from a young age.

Even as one of the most traditional methods of teaching children about money — cash transactions — is becoming obsolete, remaining vital are fundamental principles of saving, investing, and understanding trade-offs.

Pete said you don’t need to give children “formal lessons” because it can be more effective to integrate financial concepts into everyday life.

Practical insights can be provided by explaining the family budget or discussing why certain purchases can’t be made (“For everything we do, there might be something we can’t do”).

Hope 103.2 is proudly supported by

The digital age has transformed the way we engage with money.

“It’s a lot more difficult nowadays… They never see a transaction of something going out,” said Ben about his kids trying to get their heads around finances.

But Pete added that children are more attuned to digital interactions: “They can see on the app [money has left the account]; they didn’t need to see a $50 note.”

The rise of digital banking tools such as Spriggy and others provides an accessible platform for children to learn about financial management that resonates with their tech-savvy upbringing. These tools often allow children to track their savings, leaving room for parents to explain concepts.

The evolving nature of financial transactions today poses both challenges and opportunities for teaching kids about money.

Parents are key influencers in their children’s understanding of money, yet the approach can vary.

Parents face a delicate balance between educating and overwhelming their children with financial information.

Pete reflected on his experiences with his teenagers: “I probably erred on the side of less disclosure.”

Wishing he had started a bit earlier with his kids, Pete came to realise “the best lessons and the best resource is your own money” – including your mistakes.

Open, non-judgmental dialogue about money can foster healthy financial habits and independence in young people.

Parents should view financial mistakes as learning opportunities for their children.

They can be empowered through a trial-and-error approach under parental guidance without fear of judgment.

Encouraging kids to work and manage their earnings fosters financial independence and responsibility.

“The best things we’ve ever done is work, and one of the best things we probably ever did for our kids was encourage them to get part time jobs,” said Pete.