Financial literacy key to youth development

By Portia Sigauke

Harare: The spending behavior of youth combined with their limited understanding of money management promotes habits that may lead to costly financial mistakes today and in the future.

While youth’s financial literacy is low, their spending power is high.

To increase financial literacy and better money management practices, educators need to understand the financial behaviors and attitudes of the current generation of youth.

According to a survey conducted by this writer showed that most youths lack knowledge and responsibility associated with money management

Three trends posing a threat to youth’s ability to manage their money are adult behaviors as role models for youth; youths as a major consumer market and media focus; and limited education for youth financial literacy.

Pretty said “First, adults appear unable to manage their own finances. And the issue of economic imbalances that we are currently facing has become a threat to managing our own finances as we are working from hand to mouth”.

“The consumer bankruptcy rate is at its highest and the national savings rate is low with many Zimbabwean families living paycheck to paycheck. While Parents discrediting their own financial behavior, see themselves as good role models,” she said.

She added that parents were ineffective in giving financial tips to their children as they are failing to manage their own finances.

As these risks threaten the self sufficiency of today’s youth, further investigation is needed. A search of the literature revealed five critical financial behaviors specific to youth: earning and accessing money, budgeting and spending, saving, banking, and using credit.

 

 

Tatenda had this to say “the use of plastic money has also promoted this reckless behavior coupled by lack of knowledge because we tend to overspend using our mobile or plastic money without even budgeting for the things we tend to buy”.

“We seriously need to be educated on how we can budget for us to use our money sparingly. I would request for financial service providers to come out and help young people by educating us on how we can spend money,” he added.

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