The 2022 Prince’s Trust NatWest Youth Index revealed that 49% of young people (aged 16-25) don’t think they’ll ever be financially stable. This age group feels under pressure, worried about the impact of the pandemic on their futures, and 59% don’t think they will ever be able to afford their own home.
44% of young people think the pandemic has made it harder for them to find a job, and only 24% feel confident managing money on their own. 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, schools are often short of time and resources, and parental actions can have a greater impact. Only 40% of children say they were taught about money at school according to Money Helper (formerly the Money Advice Service). 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.