As a society, I believe we must work together to raise financially-literate young people. The work force is currently undergoing huge changes, which will present both challenges and opportunities moving forward. As a father and school teacher, I would like to see some form of financial literacy taught in our schools from an early age. The ability to understand and manage one’s finances is an essential life skill.
The only time discussions around money tend to come up in our schooling system is in mathematics – “Johnny takes 12 apples to the market, sells eight, then eats one on the way home. How many apples does Johnny have left?” Examples like this do not address key practical issues like personal earning, saving, investing, or giving. Whether we like it or not, money plays a huge role in each of our lives.
After 20 years of marriage, my wife and I own our own home and are making progress paying off our mortgage. However, saving the initial house deposit 10 years ago took both vision and discipline. (I must confess that my wife took the lead in this area).
Advertising companies tell us we can have anything we want when we want it. However, this is simply not wise or sustainable. It’s important to teach our children and grandchildren the value of hard work and the joy and pride that comes from carefully saving for something of value. There is also the important philosophy of being content in all circumstances, while we work towards achieving our goals.
Last year, our eight-year-old son Jack personally raised $135 during the school holidays in order to purchase a Lego Technic crane. He achieved this through selling fruit, toys and kindling wood. Angela and I were proud of the way he set his mind toward achieving his goal, developed a plan, and worked hard to achieve it.
We’ve all seen the cliché headline, “Secrets of the rich”, but there are timeless economic truths that exist. I believe these need to be taught and modeled to our young people from an early age in order to help them succeed in this area. There is a widening gap in our society between those with capital and those without. Teaching our children and grandchildren the value of hard work, managing their finances, and smart investing, will help close this gap.
Many children are taught financial literacy by their parents, but unfortunately many are not. And often that’s because the parents have never been taught it themselves. Schools can become community hubs for learning, for all ages, with parents learning alongside their children. A number of schools are already developing financial literacy programmes, often partnering with local banks to achieve this. Over the years, Angela and I have regularly had to budget carefully, grow our own food, limit the use of our vehicle, and delay instant gratification. However, we don’t feel like our children have missed out. The essentials of a warm dry house, nutritious food, and a secure environment have remained in place.
We have all made financial mistakes, and grandparents have the wisdom of many years of managing money. I remember asking my grandfather if he wanted to invest in a scheme a few years ago. His reply was, “Those are very good returns, but let’s give it some time to see how it goes.” Sure enough, the scheme fell over within three months.
As a practical idea, you could try giving your child or grandchild $20 and saying, “See if you can double this, then give me the $20 back and keep $20 for yourself.” You’ll probably end up letting them keep the whole lot, but it will be a good educational lesson in creative thinking. Many of the jobs in the future will need to be self-created – we need young Kiwis with an entrepreneurial spirit.
We can create a generation of financially literate young people. If we want long-lasting societal changes, we must begin with the children. Never underestimate their ability to comprehend and deal with complex societal issues that us adults have failed to find solutions for. We must let their vision and enthusiasm inspire us.