Financial Lessons Your Kids Won't Learn at School

Don’t assume your kids have a financial education

With your kids at school, you may expect that they will learn be learning the basics about saving for the future and facing financial obstacles. However, that is likely not the case.  

Surprisingly, children receive almost no financial education in schools in the majority of countries, and many leave school knowing next to nothing about saving and investing.

This lack of education leaves many consumers feeling they are uneducated in terms of personal finance according to one study.

That said, in recent years, new online platforms in many countries have made it easier and cheaper for anybody to invest.

In many ways, this is positive, because ready access to these platforms has engaged a new generation with investing. Given the financial hardships younger generations are likely to face in many places, from student loans to an inaccessible housing market, it’s vital they start thinking about their futures now.

However, there are concerns here too. Instead of the formal financial education they should be receiving, young people are turning to social media influencers to learn about investing, who can be both good and bad. It’s common for influencers to misrepresent investing or portray it as a short-term process. In reality, investing happens over a long period of time and is far more boring.  

Episodes such as the GameStop saga in the United States back in 2021 haven’t helped. For many people, their first taste of investing was through buying shares in this company along with others that were referred to as ‘meme stocks’. While many profited handsomely, they’ve also been left with a distorted impression of how the stock market usually works.

It’s not just the ‘meme stocks’. More and more young people are being lulled in by the staggering increase in popularity of crypto currencies like Bitcoin and Dogecoin. Crypto has fast become the asset of choice for generation Z.

Those who enter into cryptocurrencies are not offered the same regulatory protections available through other investments. For even the most seasoned investors, such assets are to be handled with care given their high degree of risk and volatility.

Social media and meme stocks might currently be engaging young people with investing, but it’s paramount they have certain core principles under their belt first. This is where you can help. Talk to your kids - tell them about the importance of investing into for retirement, or the value of regular saving. The articles below can help you begin that process.