Recent research* has revealed that 39% of young people between the ages of 16 and 25 don’t feel like they are in control of their own lives. This age group feels under pressure, and their biggest fears for the future are a lack of financial security, fewer job opportunities and a belief that they will need to work and save for longer than their parents to be able to put down a deposit on their own home.
Yet, despite this prediction of tough financial times ahead, 44% of 18- to 24-year-olds† said they find money a difficult topic to talk about. So what can parents do to ease the concerns of their teens and prepare them for the future?
A natural reaction
To an early teen (aged 13-15), the future might look exciting, a time of independence, freedom and fun. It is only when that independence – a first job, leaving home or supporting themselves financially – is imminent (age 16-18), that the future suddenly becomes something to possibly fear.
According to psychologist Dr Carl E Pickhardt§, this fear of the future is a normal reaction to the unknown. It is part of the mind’s natural emotional awareness system reacting to a change in our world of experience – warning us of perceived dangers. And this is not a bad thing, it just depends how well prepared your teen is for this change and its new responsibilities.
In any area of their life, one of the keys to preparing your child for the future is nurturing their self-esteem and showing them that you believe they are capable of making the right decisions in life and acting confidently and responsibly. A teen with stronger self-belief is less likely to give in to peer pressure, whether it’s skipping classes or running up debts. Your child may not be top of the class in Maths or Science, but if they have a hobby or subject they do enjoy, there’s a pretty good chance they’ll do well in another area. Qualities such as emotional intelligence, patience, determination and sociability are equally important to your teen’s future success.
Learning the hard way
Although financial education has been on the curriculum for secondary schools since 2014, they are often short of time and resources, and parental actions have been shown to have a far greater impact on a child’s financial capability in the long run.¶ The best way for children to learn is by being given the opportunity to make their own mistakes, so stepping in to bail out your child every time they run out of money or make a wrong decision won’t allow them to learn financial independence. Key budgeting skills can be learned from the moment they first receive pocket money. But in this complex financial world, teens need the knowledge as well as experience to make the right decisions as they venture out into the world of work or college.