I have been saying for a long time that our kids need to be taught how to manage their money. What’s more, this should be part of their formal school education. Well, now The Salvos (like they always do) are coming to the rescue for many Aussies who lack financial literacy.
If ever there was a need for improving the financial literacy of all Australians, new research by The Salvation Army provides alarming evidence. It found almost half of all Australians (46 per cent) are starting 2025 in debt, 3.2 million (15 per cent) don’t understand how interest works and almost one in three (30 per cent) are unable to create a household budget for themselves.
This comes off the back of an expensive Christmas and holiday period for many Australians. One where over 34 per cent of Aussies used credit cards and 17 per cent used ‘buy now, pay later’ schemes to pay for Christmas. A shocking 6.3 per cent borrowed money and 8.9 per cent sold personal belongings so they could afford Christmas in 2024.
Moneycare to the rescue
The Salvos provide a terrific Moneycare service which is a free and confidential financial counselling service which supports thousands of Australians each year to get on top of their financial situation. In the last financial year, Moneycare provided 52,000 sessions of care to those struggling with their finances, and 27 per cent of those who reached out to Moneycare were employed.
They’ve noticed a disturbing trend where ‘buy now, pay later’ products have overtaken credit cards as the most common form of debt amongst its community members. Many are also using these schemes to make ends meet – paying for products such as groceries and pharmaceutical items.
Spread the word
The Salvos’ Moneycare service also has free online tools and resources, as well as free financial counsellors who you can speak to anonymously via live chat.
It’s such a great service and can really be a lifeline for those who find themselves drowning in financial stress. If you know someone who is in financial difficulty, point them in the direction of Moneycare as it’s a great first step.
Education matters
The Salvos research highlights why it’s so important that our kids gain an understanding of finance.
Education is so much more than teaching our kids how to read and write. It’s about prepping them and giving them the skills to navigate the big wide world on their own. And this includes learning about how to manage their money.
As The Salvos research shows, financial illiteracy can lead to debt and a world of financial stress.
It can also lead to a poor economy on the whole. We need to make financial literacy a part of the school curriculum so the next generation do not get into money strife.
So it isn’t just teaching children how to calculate their spending and work out the change, it’s also instilling in them the importance of budgeting, being wary of debt, scams and ‘Buy Now, Pay Later‘ traps, and also, how to develop a money mindset for life.
Raising financially literate kids is a big way to change The Salvos’ statistics in future.
