The way we pay for things is changing – fast. There’s an entirely new generation that’s growing up with cash-handling as just one way that they handle their money, and even that is dwindling as cards replace cash and tap-and-go replaces cards.
And in such a world, the kinds of money skills we need to teach our children also have to evolve.
Related story: To give or not to give? Pocket money splits Aussie parents
According to Zenith Payments general manager Michelle Rowcliff, there are three lessons we have to impart:
1. Spending is spending
As cash payment becomes a less popular payment method, the chances for children to ‘see’ their parents paying for things is diminishing.
“Consequently, they may not see how often transactions are taking place or how much is being spent,” Rowcliff said.
“It’s important to add dialogue to spending and involve them in the process from a younger age. If you use a credit or debit card to pay for dinner, let them see or add up the bill.” Or if you’re shopping online a lot, get your children involved when you compare costs.
“Understanding the value of money regardless of its form is a valuable skill kids must learn.”
2. Teach them to manage their money online
There’s still a bit of debate about giving children pocket money (whether you should, how much you should give) – but you might consider paying them digitally to show them where the dollars go.
There are tools online that let parents transfer money to their children, who can then see their account balance, transaction history and set savings goals.
“It gives kids a view to earning, spending and saving and their own decision making process to manage their money,” Rowcliff said.
3. The buy-now-pay-later lesson
Buy-now-pay-later schemes like Afterpay have skyrocketed in popularity, attracting the attention of regulators along the way. A popular payment method among Gen Z and millennials, they’re here to stay, said Rowcliff.
“This shift in the way we spend will require an equal change to the way we teach our children to manage their money.
“While they may get instant gratification from their purchase without seeing the financial impact instantly, we should teach children that in many ways, using these services is like taking a loan.”
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