Parents, you need to start a financial bootcamp for your kids. 

Why? The latest OECD survey on teenage financial literacy has found Australian standards have fallen since 2012… and 20 per cent of teenagers are below the minimum standard of knowledge. But before we start pointing the finger at schools, we should be point fingers at ourselves.

Numerous research shows teenagers learn virtually all of their financial knowledge by observing their parents. Think about it, and your money behaviours? It’s a bit scary the kids are watching you that closely.

It’s always a fine line between including children in so-called “adult decisions” to help with their personal growth and protecting them to enjoy a stress free childhood.

Household finances are a classic example. In the past any discussion about money was seen as grubby, one of those taboo topics never to be discussed. It produced teenagers and young adults ill prepared in simple matters of money management which often led to some very expensive mistakes.

The key is coming up with a constructive middle ground…. Remembering you are the best financial tutor for your children. Here are our tips on what to share… and what not to.

5 financial skills to teach your kids, for more visit moneysaverHQ


✔ Financial goals

It’s great to let children see that you’re saving for something which benefits the whole family. It could be buying a car, saving for a family holiday or even new clothes.

It’s a great life message that you can’t have everything you want without a bit of planning and a little sacrifice. When the goal is achieved and you’re sitting under a palm tree sipping a cocktail, remind the kids what it took to get there and wasn’t it worth the planning.

Paying bills

We always laugh at the outrage from our adult children when they read their first payslip and saw the amount of tax taken out. All of a sudden they realise who pays for the roads, schools and hospitals.

Likewise, the first time we took them through our supermarket bill and compared it to their pocket money. It shows that day-to-day items, which are often taken for granted, do have a value and shouldn’t be wasted.

We would also break down the cost of an item into how many hours they’d have to work at McDonalds (all our kids had part time jobs at McDonalds) to pay for it. The message really sank in.

Making good consumer choices

Drag them along shopping and show that consumers have choices. That big brand names are often more expensive but not necessarily better. That supermarket prices are usually more expensive at eye level on a shelf than above or below.

Take them shopping and treat it like a field trip and pass on your canny shopping tips.

✔ Everyday financial experiences

Go through your on-line banking with the children and explain what a financial institution does, the concept of earning interest and the difference between the range of accounts.

The same with the credit card statement. Explain that bit of plastic isn’t a money tree and it has to be paid back, often with interest. Whip out the debt card and explain the difference.

Charitable donations

We would always talk about making donations (not the amount but the organisations) because we wanted to show that everyone has a responsibility to help others in the community. We also insisted they donate a percentage of their pocket money to a charity of their choice.


✘ How much you earn

All a child wants to know is that you’re able to look after them. They want that security.

Dollar amounts are often confusing and they have no concept of the extent of what that figure needs to cover. So it’s better to avoid a figure and just say “enough to make sure we’re okay”.

✘ Level of debt

A 25 year home loan is a scary prospect for any aged child… 12 months is a long way off. So explain the concept of debt and how to use it properly to acquire things which hopefully appreciate in value. But avoid talking numbers or whinging about how long it will take to pay off.

✘ Investments

We think it makes sense to wait until children are late teenagers studying business or economics at high school or show an interest in investing. It’s confusing enough for adults.

When you do share, there’s no need to talk about dollar amounts, but talk about why you bought some of your shares and what moves prices. Relate shares to companies and brands that children use everyday like retailers, clothing or technology brands.

Then move on to explaining other investments and how they operate. Show them your superannuation statement and where the money is invested.

✘ Wills and life insurance

Most children hate the thought of being alone, of losing mum or dad. So don’t even attempt to explain wills or life insurance until they’re old enough to cope emotionally with the prospect.