Teaching Better Money Management Skills to the Young.

‘Saving’ was once considered to be the main ingredient for managing money, this does not hold true anymore. ‘Spending wisely’ is the key component out of all the money management skills out there.

Now the question is how do you ‘spend wisely’ if you never learned the basic concepts of money management? The biggest problem many people face today is how to save, spend or worse… earn money (not in that order precisely).

Before I delve on to the rest of the article, I do want to mention an answer I wrote on Quora a couple of years ago, that does sum up savigns well. The original question was What are most useful money investment and savings tricks?

Two tricks, both are exceptionally easy to understand:


Most people have a monthly income. They pay all their bills and whatever is left, they then set aside a portion and put it in their savings. Wrong!

The correct way to save: Monthly income, set aside what you want to save and then whatever amount you have left, you use that to pay your bills and spend as you choose. Savings comes first.


“If something cost $1,000, and it is on sale for $750, and then you decide to buy it, you did not save $250. You spent $750.”

Money management has always been an issue with teens, adults, aged and since a decade or so, thanks to credit cards and loans, even the deceased! Moreover, the only reason everyone faces this issue is that it is not considered important enough to be taught at an early age and this has to change.

In case you are wondering why it needs to be taught in this day and age when previously there was hardly a problem; consider this: there is a constant barrage of messages from media and the advertising industry.

Not only do the simplest of advertisements showcase a happy lifestyle after an individual item is purchased, but it enforces the viewers to make impulsive purchases without a second thought. The marketing adverts are so enticing that you see people walking the same line and singing the same tune.

Take reduction sales for example. You get email notifications and pings on your phone round the year about them, no? Then what happens? People jump at the opportunity to buy things because there is a discount. However, for someone who has been taught how to tell the difference between saving and investing would know how to contain these buying impulses because s/he can easily see that by not spending money or not falling for those 20% discount adverts, s/he will have been saving a 100%

Forget to save and to invest, If in middle school, children were taught the difference between contentment and instant gratification, they would not be making impulsive purchases when they grew up. They would only ask themselves “how many times will I use this item?” or “how long will I be using this product,” and this would be enough to decide if the expense is worth it or not.

Teaching basics of critical thinking at an early age is now a must because issues such as debt burden, zero savings, student loans, wealth inequality, poverty, no money for retiring, etc. all become very real problems from early adulthood as professional/college life begins.

We already know that financial literacy is negligible and we also know that basic concepts of saving, money responsibility and cost comparison should be taught at an early age for children to develop sound decision-making habits where money is concerned. However, knowing isn’t enough, not anymore.

So the next obvious question is ‘What radical steps can be taken to improve it?’

Those of you who have heard of it may argue that children are taught these very concepts of money management in VISA’s Practical Money Skills for Life partner program. However, do you think that one program catering to 40 countries only will have a snowball effect on the remaining of the 156 countries and associated regions? Yes, the VISA partner program is a great initiative. Its free, it is available in over 15 languages, and it is sadly the only financial education program out there trying to reach millions of people around the world. But is it really? If you visit their website and just switch the country from USA to UAE or KSA, you will notice that there is no curriculum to read or download, you just see some tips and guidelines.

The program which VISA started over 20 years ago is offering exactly what we need right now but at a much larger scale because clearly, catering to 40 countries isn’t enough.

Courses such as Art of Budgeting, Adverse Influence of Advertisements, Learning to be Financially Responsible, Staying out of Debt and much more should be standardized in every school. This approach will not only cater to every kind of student in the best way but also tackle a social ill, and in return, we will be able to protect our economy. All this by investing in a healthy financial education.

Children as young as preschoolers, begin to understand notions of cost and value if only it is taught. So yes, it is sad that such vital concepts are not taught as part of the regular curriculum when they should be elective if not a compulsory subject.

We have to accept that young adults are facing financial crises and implementing a fix in every school is a grave need of this time. Teaching money management skills from the school days is a must because kids need to know that good food and happy families do not magically appear by getting new furniture, upgrading to the latest phone or by switching to a different edible oil.

Yes, it will take a while, but once these fundamental concepts of money management are taught and applied, we will not just be saving money for retirement, but issues like debts and poverty may just completely go away.

This page was last updated on June 3, 2017.

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