When Wealth Designers senior financial adviser Dawn Thomas asked a group of Year 9 students at all girls Penrhos College which cohort has the least amount of superannuation, they were shocked to learn the answer.
“Being kids, they threw out the most imaginative answer, which I’ve never heard before,” Thomas tells Professional Planner. “They said babies.”
While Thomas conceded that’s not technically wrong, the correct answer is women.
“I said ‘do you know that women retire with half the amount of superannuation that men do?’ They were like, ‘what?’ And I said, ‘Do you think that’s fair?’ And they said, ‘No!’”
The presentation by Thomas, along with Horizon Group of Companies financial advisers Remo Venditti, is part of a program that goes into high schools to teach students about budgeting, financial goals, compounding, investing, and super.
FAAA general manager of education and professionalism Anne Palmer says this is part of an “informal” project by the association to teach financial literacy to students.
“Dawn and [Remo] developed their own content in liaison with the FAAA, which is fantastic,” she says.
“Usually, members are asked by their local school to come and give a talk and then we [the FAAA] will support them through that approach.”
A vital need
Palmer says teaching financial literacy to young people is “incredibly important”.
“[It] is probably one of the most important subjects they’ll ever learn going forward. It sets [them] up for success in the future, not just financially but everything.”
Thomas agrees. “We always say the foundation of any financial plan is understanding your cash flow and budgeting,” she says.
“Even if [children] don’t know what to do with their birthday money, or what they’re getting from chores, it’s going to be hard for them to understand what they’re tracking towards. We talk about understanding your cash flow and your budget, and what [your goals are]. What are you saving for? Can we use the idea of saving over debt?”
Thomas adds the earlier people begin the practice of saving for things instead of relying on incurring debts and borrowing money, the better.
“If they understand the benefits of long-term investing, it’s really the world’s their oyster, because it means they have to do less if they start earlier,” Thomas says.
“Young people right now can actually just give themselves a good start. It’s really important that they are equipped with the tools to do that.”
Talk Money empowers over 230,000 students
Concerned about a drop in youth financial literacy, Ecstra launched the Talk Money program in 2022. to teach children more about financial literacy.
Since then, it has delivered Talk Money workshops to 231,832 students since 2022, 6258 workshops and 1031 schools across Australia.
Roadshows comprise 17 per cent of Talk Money bookings, and Ecstra Foundation manager Tracey West says this is when the organisation can spend concentrated time in regional areas across Australia.
“We do offer online workshops but prefer face-to-face for the student engagement experience,” West says.
Approximately 24 per cent of 2023 bookings were repeat bookings by schools that had booked previously.
“We are seeing more schools book us for all of the workshops on offer, and we expect this will grow in 2024,” West says.
“I think this is a good indication that the teachers see a lot of value in financial literacy and having external facilitators. The teachers often report that observing the program gives them confidence to have conversations about money in the classroom.”
She adds that Ecstra is currently in the process of reviewing the Talk Money program based on feedback received from schools and students.
Like Palmer, West believes teaching financial literacy is important. “It’s a key life skill.”
