Cynics argue that Black Friday doesn’t teach your kids any life-long lessons they need to learn. Described by sceptics as a “capitalist consumption machine” that encourages consumers to spend till they drop- even if they are getting a steal on credit- is just one of the numerous shortcomings of the entire event. But what if we told you that you can take all the bad from this event and turn it to a lifetime of positive financial lessons for your kids?
Black Friday is the biggest man-made discount event of the year. Dare we say, it might just be better than Christmas shopping. Falling on 24 November this year, many had their wallets and shopping lists at the ready for the shopping trip of their lives. Happening over a minimum period of 24 hours depending on each retailer, one would view the event as a coming together of not-so-smart consumers spending money they do not have on things they do not need in record time. It isn’t the best example to set for kids due the emphasis on consumerism and irresponsible spending habits. But what have we learned from this year’s Black Friday extravaganza that we can take away with us? Here are the three major lessons that you might have missed in your rush to catch Black Friday deals.
Budget in advance. Black Friday just happened for the third year running this year. So, it is safe to say that it is going to happen again in 2018. Budgeting a whole year in advance is a great way to get your kids involved in the event. Including them in the process of budgeting by saving R200 a month for twelve-months in preparation for the event can teach them the benefits of delayed gratification. A budget also encourages kids to create a list of the essentials that they could not get during the year at a cheaper price.
Saving. Having a budget is one thing, but saving 20% of that budget after buying everything on your list of essentials will give your kids the zeal needed to continue the tradition into the following year. Getting them to donate that 20% they didn’t get to spend will be a bonus for them too. Having the foresight and practice to save 10% of your budget here and there is a nice way to get them to see that there is a reward for going the extra mile of finding the best deal possible by comparing prices.
Responsible spending. There is an enormous variety of products available on Black Friday. Retailers use the discount angle to get consumers through their doors and sales up. This makes the “logical consumer” within us disappear for at least 24-hours, only to re-appear when there is no money left to spend or are in severe debt due to overspending. This event just shows us as well as our kids what not to do in the event we can’t afford to go on a shopping spree. Its shows how easy it is to land into debt and serves as an example of how to avoid these traps for your kids too.
The biggest discount event on the planet is also the best way to teach your kids healthy spending habits as well as an alternative attitude towards money. Instead of campaigning for this one day to grind to a halt, use its downfalls as an incentive to teach your kids the financial lessons you never learned and help your kids lead a money savvy life.
By: Kgopotso Kgwedi
‘Raising Money Savvy Kids book launched this week and we have had some fantastic feedback.
Please go to the book tab and buy your copy for R50.
Thank you so so much for the book. Its so easy to read ,its well written , I felt as if you were sitting right there in my living room next to me when I was reading it. Not only will I use the knowledge for my daughter, but for myself as well for example the table that you gave on page 42. it was so informative I could not put it down. I will read it again slowly taking notes and will certainly apply to my 7 year old daughter.
Just been flicking through your new book.
Congratulations, it is terrific.
I love the personal commentary and link to your family life and experiences as it makes a real connection with the readers.
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MSK is proud to announce their very first offering in the form of a straight-to-the-point yet effective guide to Raising Money Savvy Kids. The book gives parents hands-on lessons for kids between ages four and fifteen and will be available in epub and PDF formats on the website for only R50 per download.
According to Momentum financial wellness researcher, Pieter Rossouw, it remains to be seen if the South African millennials or ‘Afrilennials’ will survive financially in an already challenging economic environment. As members of the swipe-and-click generation, youth are at risk of showing a lack of appreciation for the value of physical money. With the concept of money becoming more abstract by the year, wallets no longer contain physical money, only plastic. With the rise of cryptocurrencies such as Bitcoin, it has become imperative to teach our youth the financial basics from as young as three.
South Africa has one of the lowest financial literacy levels in the world. The majority of our adult population is trapped in severe debt and many Afrilennials are heading in the same direction if serious steps are not taken. With a vast array of financially sophisticated products available to them it is important that young people truly understand all the financial concepts and pitfalls that come with products.
Written by Kathryn Main, a devoted mother of three, her parental instincts recognise the critical importance of giving South African youth a financial advantage their parents never had. Make sure to purchase your own copy to secure a money savvy life for your child/ren.
After the 2008 global economic meltdown, many young adults remain wary about using credit. Of the 55-million people living in South Africa today, a minimum of 20-million are young adults. This is 20-million young and impulsive potential consumerism victims that are repetitively bombarded with dazzling commercials that offer a gateway into debt.
Either through offering ‘free’ R1000 vouchers when you open an instore account or influencing their consumers to blow R1000 or more – that they do not have – just to get R300 off purchases accumulated, retailers are out to make a profit by landing you into debt you do not need. Advertisements lure you into needing something that you want. Due to the blurring line between needs and wants, the NCR (National Credit Regulation) found that ten million people in the republic find themselves in severe debt.
But Millennials seem to be struggling to avoid credit as best they can. A recent Bankrate survey conducted in the United States of America reveals that fewer than one third of people between ages 18 and 35 have a credit card. And as it stands, this is a record low percentage. In South Africa, however, people are financing their lives through credit. Whether it be buying necessities such as clothing and food, consumers are trapped in the vicious buy-now-pay-later cycle. Consumers conveniently forget that paying back the money later will come with interest attached. This ultimately means that consumers find themselves in a worse off situation when the next payday arrives.
Another factor keeping consumers trapped in debt is the process of building a credit record. Young people are especially at risk as it is a rite of passage to sail uncharted credit waters. To build a strong credit, financial institutions need to see that they are a responsible payer. To be able to buy that dream house or that car you have been eyeing since its release into the market, it is required to have been in debt at one point in the past and be on top of said debt’s repayments during the time in which you apply for a home loan at the bank.
Understanding the repercussions of getting into debt is a crucial skill for consumers to hone. This skill will allow for the x-ray vision needed to see the inner trappings of debt when it is offered in extravagant packaging known as advertising. So, spending that R1000 to get R300 vouchers leaving you in R700 debt will be a not so bright idea after all.