Passing the Baton
An Interview with Peter Temple on Helping Young People and Financial Matters
TOPIC: How to Teach Millennials and Gen Z About Budgeting
“Gen Z” is recognized today as the generation born between 1997 until present and “millennials” between 1981 – 1996. Here are some straightforward questions asked by a client on helping adult children and families.
Q: Having adult children what areas have you taught or observed your children struggling with financially?
My children struggle with budgeting and saving money. Many purchases made online or through credit card and very hard to control expenditure without a tracking system in place. There are many apps out there but young people first need to be motivated to save their money for future goals such as early retirement or a house purchase etc.
This is where high school education would help so much. Financial literacy is just as important as algebra and Shakespear!
Q: What values have you instilled in them?
I have attempted to teach my kids to plan for their future security by looking after their physical and mental health and their money. I am not always listened to but I feel if I repeat it enough some of my words may be heard!
Q: What recommendations do you have for their peers and them?
They should never bury their head in the sand and hope all will be okay. Take a high level view of where they are emotionally and financially and make plans to be where they want to be. Revisit these plans on a regular basis and do not stress if you fail sometimes to follow them. The important thing is to have a plan and to try and follow it.
Q: You want your kids to have international experience, any advice on Gap Year planning?
Planning is best and I found three wonderful articles to pass on to you.
Though still relevant from 2013, “How to Save Money for Your Gap Year,”is a great read. Written this year, How to Travel without Taking a Gap Year,” and“How to Give Your Child the Cheapest Gap Year” I found quite helpful.
Q: Any tips on helping young children develop budgeting skills?
Must be made fun to do and include the whole family. Make it into a game and have rewards for saving money such as the purchase of a toy. I feel that giving pocket money is great way of teaching budgeting skills. Once the pocket money is spent nothing else can be bought. Kids soon learn to look after their money and spin it out until they are next paid. Nothing worse than seeing your sibling buy candy when you can`t because your piggy bank is empty.
Also consider giving your kids chores to earn their pocket money. That way they will value it more and learn it has to be earned.
I could be a traditionalist and say use cash only but how realistic is this for next generation? There are likely some funs apps out there that will help kids to budget and use their money and they should learn to use them as this is the way ahead. This link reviews some which are on the market.