The most common statement we hear from our budget coaching clients is – “why were we never taught this?”
Lack of practical financial education is having a significant impact on our younger generations:
- 1 in 4 households with mortgages are in mortgage stress
- 1 in 3 young Australians 18 to 35 living pay to pay and struggling with credit card debt
- 1 in 2 young Australians experience financial stress on a weekly basis
- 30% of households with mortgages have less than one month’s repayment buffer
Financial stress and anxiety has a way of overflowing into all areas of our lives. Our relationships, mental health, productivity and self-esteem all suffer if our finances are a mess.
Unless we are proactive in teaching our teenagers how to handle money, the odds are high that clever marketing, easy access to debt and our consumer culture will lead them astray.
Addressing the problem
Traditional classroom-based financial literacy programs are not working because money skills, like other life skills, need to be ‘lived’ to be learnt.
If you teach financial literacy like you teach calculus or algebra, kids will learn the topic to pass an exam but have no more idea of how to apply those money lessons in real life than they do calculus!
Effectively teaching kids money skills requires an ongoing process of teaching followed by relevant real-life opportunities for practical application.
Financial coach, educator and father of 3 teenagers, Phil McGilvray has developed the ‘Money Skills for Life’ program with the goal to effectively bridge the gap between classroom education and real-life money skills. This program will have three components:
Practical classroom-based workshops where students will learn the core principles
Fun homework tasks to apply what they are learning in relevant real-life situations
Parent participation activities to provide students with practical learning opportunities
The practical workshops
Though classroom-based, these workshops will have an emphasis on learning through ‘doing’.
Throughout this program the students will be expected to set up and maintain a budget using the Grandma’s Jars budget software and mobile applications.
The first 3 sessions will be dedicated to showing them how to set up and manage their budget.
Naturally flowing from maintaining their own budgets will come questions related to spending, saving, and earning money. These questions will then become fuel for deeper discussions and learning in a way that is relevant to the students.
The core topics covered in the practical workshops will include:
#1 – 5 simple principles to excel with money
#2 – Setting up a budget that allows you to save money and spend on the things that really matter
#3 – Strategies to help you consistently spend less than you earn
#4 – The ideal bank account structure to support your budget
#5 – Understanding debt and staying out of trouble
#6 – Investment basics - how to get money working for you.
#7 – Preparing for major life events like buying a car, moving out of home, etc
#8 – Setting goals and saving for fun stuff
The homework tasks
‘Homework’ is probably the wrong word to use here because these tasks are more fun opportunities to apply what they are learning in real life situations.
As outlined above, students will be required to maintain a budget to track, record and guide their spending using the Grandma’s Jars budget application.
Given that most spending occurs outside of school hours recording expenses as they occur will be an ongoing homework task.
In addition to maintaining a budget, every workshop will be followed by a practical homework task.
The homework tasks will provide students with real life opportunities to practically apply what they have learnt throughout the workshops.
Examples of these tasks may include:
- Setting up the ideal bank account structure to support their budget
- Preparing a meal plan for their family for a week, drawing up a shopping list and doing the weekly grocery shop while sticking to a budget
- Setting a financial / savings goal to achieve through the program
- Identifying how much it costs per km to keep the family car running and so on…
As parents, we know that we have an important role to play in teaching our children important life skills. This is especially the case when it comes to teaching our kids about money.
The problem for most parents is they don’t know how and where to start - and then of course there is the reality that very few kids like to be told what to do by their parents!
To encourage interaction following each session, a video will be sent to parents outlining:
- The topic that was covered in the workshop
- The homework tasks given to the students
- Guidelines and tips on how parents can engage with the student on homework tasks
The purpose of parent participation is to encourage interaction between parent and child so that lessons don’t stay in the classroom but overflow into everyday life.
Teens will also be armed with fun curly questions to ask their parents after each workshop to help break the ice and get the money discussions flowing.
Parents and carers will be provided with additional guidelines and instructions on how best to support and encourage their teen throughout this program.
Typical program details
- There will be eight 90-minute workshops
- The first 4 workshops are typically held 2 weeks apart and the last 4 workshops are held one month apart
- The first half of each session will be focussed on finalising the previous month’s budget, the second half will focus on developing non-budget related financial skills like saving, investing, debt and goal setting
- Students and parents will be encouraged to ask questions, and where possible questions will be answered by a video that can be shared for the benefit of the entire group
- The cost of the course is $97 / student
Interested in the Money Skills for Life program?
If you would like to run this program for your school, youth group or family, please click on the link below and fill in the enquiry form and one of our team will be in touch answer any questions and to discuss how we can tailor a program to suit your needs.