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Teaching kids to manage money in 7 easy steps

How can we teach children to be financially literate? And is it really necessary?


Starting young is recommended so children understand how money works and how they can make it work for them, even when their income is just a few dollars of pocket money.


Overconfident and underprepared for money management

Research shows that young people are overconfident and underprepared when it comes to managing their money.^ They think they are more capable than they really are.


So parents and family need to take advantage of learning opportunities to help children acquire the financial skills they need to navigate the world of money management.


Futureproof your kids to save and spend

Financial literacy is an important life skill for young people to futureproof  their money management and give them the skills to avoid financial problems when they take charge of their earning and spending.


Prepare your children to make informed decisions and avoid financial traps as they get into the workforce and earn money.  


Keep up with technology with ZAAP

As the cash economy transitions to the innovative world of digital payments, keep up with new technology that helps children learn about money management.


Check out the ZAAP app, with new leading-edge digital technology for pocket money that make it a great learning tool and an introduction to pocket money payment, spending and money management.


Seven steps to financial literacy

Our seven steps for teaching financial literacy at any age:

  1. Teach. Be a good role model and take opportunities to talk about money whatever the age of your children. They will copy you, so be aware of your money habits, your attitude to money and what your children see you doing with money.

  2. Talk. Make money part of the conversation, answer their questions about how you manage your money. Spending, saving, borrowing, giving can be part of the family discussions. Maths is part of everyday life so make opportunities to talk about money as part of the learning conversation.

  3. Earn. Talk about where money comes from and how you earn it. When you child is ready (about seven or eight), talk about pocket money and the ways it can be earned.

  4. Spend. Shopping can be a learning experience. Talk about the difference between needs and wants, why prices vary, how to make realistic spending decisions.

  5. Save. This can be a difficult concept for young people to understand so show them how to put some money aside for future use. Talk about saving in terms of future opportunities to buy things they really want. Include some ideas for education to get children thinking about future possibilities whether it is university or a trade.

  6. Give. Sharing is one of the basic life skills learned from a very young age. Showing children how to donate to good causes and share some of their money is part of money management.

  7. Borrow. Kids need to know that not everything can be paid for upfront, like a house, car and even education. So while saving is a critical factor, the concept of borrowing money for important purchases should be included in their learning. Talk about the use of credit cards and how they can be managed to benefit the users.


ZAAP it for learning success

Make the seven steps work for your family with ZAAP. From dollars and cents to ‘invisible money’, ZAAP makes it easy for children to understand how to save and spend.


And the advantage for parents is that ZAAP keeps you in control of the balance. You know what your children are spending their money on and can top up for emergencies.


The ZAAP app works with a prepaid card that can feature your own personal design, and a wearable wristband that can make payments with contactless technology.


Visit zaap.com.au for more details about how ZAAP can help you and your family learn valuable money management skills.



^Financial Capability Among Young Adults. Annamaria Lusardi, Ph.D. George Washington University, 2014. Study to analyse financial capability among young adults, including indicators to assess important determinants of young adults’ financial behaviour.