I’m sat here doing some preparation for a talk next week to the sixth form at QE school, Wimborne, on how to manage money. I’m thinking about what new potential clients have said to me over the last week, and it raises the question:
Are young people in a better place to understand money than their parents?
We are particularly busy at the moment here at Blue Sky, and I’m personally seeing many new people who require help with their planning – all very different situations but they have three things in common:
- They are confused about their choices and unsure about their next steps
- They lack confidence as to what their wealth really means to them on an emotional level
- They have all researched on the Internet what they should do but nobody will tell them what to actually do!
In all these situations, the potential clients have accumulated healthy levels of capital but in all these situations inertia/fear has meant that they have put off making decisions because they didn’t know how to go about making sense of it all.
For youngsters it’s much more straightforward. They don’t yet have a jaundiced view about money, they have not been mis-sold, they have not racked up large credit card bills, they have not experienced a stock market crash, nor interest rates at 16%! They say we are born with two fears: loud noises and falling over. A fear of money isn’t one of them. This is learnt. It will come in various guises of course, as various institutions try to sell to our youngsters. Hopefully though, with better financial education, they won’t repeat many of the mistakes most of the people over 40 have made.
The Internet is certainly a valuable resource to young people. It has given us all access to more information, yet in my experience it can often deliver more uncertainty for adults. Of course there are huge benefits but most adults still appear really confused when it comes to financial decisions. Great for you and your team at Blue Sky, you may be thinking, because people need planning and advice. Well, yes it is, but often the older one gets, the stronger the pre-conceived ideas and the greater the reluctance to trust anyone. It can be hard work to re-shape thinking.
Young people however, are now able to engage in planning in a way that adults never could. Using online and App tools, they can model basic scenarios that give them a healthy steer on how they should be planning their future. I will be introducing the 7IM MyFuture App for them to trial when I’m at QE. A really useful bit of software!
Adults on the other hand have generally found themselves with an eclectic mix of policies which have not been regularly reviewed. The terminology is confusing, new rules keep coming and going, not forgetting that many companies have changed their names on numerous occasions. None of this is very helpful. Unfortunately, no technology tools were around when we were young!
I’m looking forward to meeting the students at QE and hopefully I can make a difference to their thinking or at least spark a few ideas about their financial future. You never know, they may teach me a thing or two… especially when it comes to technology!
I will just leave all you adults with one thought:
