Money management is a lifeskill for teens
Boosting their financial knowledge at school level will define the way they value money, Mukund Rao, Co-Founder of teen-centric pocket money app Muvin tells Telangana Today.
Hyderabad: Teenagers have hardly been given any real exposure to financial literacy. Boosting their financial knowledge at school level will define the way they value money, Mukund Rao, Co-Founder of teen-centric pocket money app Muvin tells Telangana Today.
Need for financial literacy
Financial literacy for teens is highly underrated. Even at home, personal finance or money management is rarely discussed with children. Banks largely classify them as being unprofitable- until they turn 18 and start seeking loans for higher education. It is unfortunate that they enter into their adulthood having minimal or no knowledge of matters related to personal finance.
Dependence on parents
Despite being tech savvy, India’s teenage population does 80% of their financial transactions in cash or depends on parents’ debit cards or UPI to pay for digital transactions. Financial literacy should focus on giving them knowledge of personal finance and money management skills. This will shape their decisions about spending, saving, investing and managing money. This habit will stay.
Responsible parenting
Children tend to copy actions of parents, especially in matters relating shopping, cutting down on expenses, or even spending irresponsibly. Educating children about money management is about setting a good example by being financially responsible and also helping them achieve early financial freedom.
Conversations
Parents should narrate their financial mistakes as well. Real life situations provide opportunities to learn about small yet necessary financial nuances. For example, parents could explain how they track their expenses via their monthly budget; relook at the shopping list, compare prices of similar products and stick to the decided budget. Older kids should also be motivated to take up internships to stress the importance of work. Parents could act as a bank where children can borrow money. Post a set date, a certain percentage can be deducted from their pocket money. It’s okay if children make mistakes while managing money but that will teach them.
Market survey
Teenagers are independent decision makers with reference to brands they buy across food, fashion, gadgets, travel and other categories. A market survey observed 94% of the parents acknowledged their children’s interest in learning about digital wallets. It reinforces the need for a more organised and dependable financial advice mechanism. Interestingly, a vast percentage of teens showed interest in crypto assets like blockchain and NFTs as well. This indicates the learning potential among teens about new age financial solutions.
Money apps
Prior to pocket money apps, children never have had visibility of their finances. Opening and operating a minor bank account is a tedious process. Mobile banking apps have a one size fits all experience, which makes it unattractive for the youth. Pocket money apps are curated for teens. With use of AI, big-data analysis and cloud computing, teens-focused pocket money apps insights that reshape their notion of transactions.
Safety
Financial skills are worth practising at all ages. Two-factor authentication must be used for all transactions. Parents can have control on the spends with a block/un-block feature.
