Conversations about money do not often come easily. The topic can seem private and sensitive, and, in many families, it is almost taboo. The problem? By avoiding these discussions, people lose out on essential information and are exposed to the risks of crippling debt, inadequate future savings, and poor budgeting practices.
This is why Tina Manyanya, spokesperson at short-term credit provider Wonga, believes it’s time to normalise money conversations and remove the stigma, ensuring South African children are at the heart of this change – cultivating a culture of open, frank, and educational conversations.
“Involving younger generations in conversations about how to spend their money is key to their development. When they’re encouraged to discuss money, parents set a standard for strong financial habits in their children’s futures,” shares Manyanya.
In South Africa, approximately 49% of adults are financially illiterate. That is roughly over 30 million people without the correct understanding of money, and the methods that can be used to protect them from financial complications.
“As the cost-of-living crisis persists, every Rand counts more than ever, and these conversations have never been more relevant,” she says.
A common outcome of poor financial literacy is over-indebtedness. In 2024, approximately 12 million adults in South Africa were over-indebted. To safeguard children from the financial distress of debt, parents can start by highlighting the difference between a need and a want. This simple idea can enable their ability to prioritise what is key to their survival versus what is not.
Lessons in budgeting and saving are also an important step in ensuring children create a healthy relationship with their finances. Introducing a savings jar into the home allows their young minds to visualise the money available to them, whilst recognising that it is not infinite.
“As a parent, contributing to the savings jar can be equally as valuable to your child. Children are highly observant and this can establish positive behaviour,” Manyanya adds.
Once the savings jar is ready, parents can set meaningful goals with their child to bring purpose to their efforts. Instead of purchasing every new toy or gadget they request, there is an opportunity for a lesson in independence. “By saving and managing their money, kids are thrown into grasping the reality of money’s true value,” she says.
Other simple and useful ways to jumpstart your child’s financial literacy:
- Turn saving into a lifelong habit: Set them up with a savings account early. Not only is this a strong reminder to protect their money, it’s also a practical introduction to how interest rates work and how savings can grow over time.
- Teach the value behind each Rand: Emphasise that money is earned and not simply given. By offering compensation for household chores, your child can learn to understand the connection between work and reward.
- Make money lessons fun: Introduce them to online resources, apps and tools designed to make financial literacy lessons easy, accessible and engaging.
“A healthy financial future is not built overnight. It is through consistent habits and open conversations that younger generations can be guided towards their financial success,” Manyanya ends.