BASIC SHORT ANSWER 2
CommBank study finds kids build more money skills than mum and dad Kids are becoming better money managers than their parents, according to new research
Children in Australia are on track to become better money managers than their parents, new research suggests.
A study of more than 4200 households by the Commonwealth Bank has found that eight out of 10 families talk about money at home, 87 per cent of children buy things with their own money and 59 per cent earn money of their own. Two-thirds of children apply spending strategies*, such as waiting for sales, shopping around and recognising wants versus needs, according to the Australian Money Matters Report released by CommBank kids’ money app, Kit.
Kit managing director Yish Koh says parents are starting to understand the importance of teaching their children about money.
Kit managing director Yish Koh said the results suggested parents were beginning to understand the importance of teaching financial literacy*.
“We are transitioning* to a cashless society*, which makes it more difficult in some respects,” she said.
“The silver lining* is we now have digital services allowing kids to interact digitally* with their money.”
Ms Koh said today’s Generation X and Y parents did not have as much access to financial knowledge and technology such as apps and websites when they were younger.
“They want to avoid their kids making the same financial mistakes they did,” she said.
Financial literacy and wellbeing advocate* Lel Smits, from the Australian Shareholders’ Association, said parents were more aware of the importance of teaching good money habits.
“Parents still play a crucial* role in teaching their children about money management.”
Stronger money skills in children would lead to increased economic stability*, lower loan defaults* and less financial hardship.
GLOSSARY
• strategies: a plan for achieving something or reaching a goal
• financial literacy: the ability to use knowledge and skills to manage your money
• transitioning: undergo changes
• cashless society: a society in which purchases of goods or services are made by credit card or electronic fund transfers rather than with cash
• silver lining: something good that can be found in a bad situation
• interact digitally: to interact on a remote digital platform rather than face-to-face
• wellness advocate: a health care professional in wellness services, including mental health
• crucial: of great importance
• economic stability: where people have the resources essential to a healthy life
• loan defaults: when a borrower stops making the required payments on a debt
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