Chris Coetzee | Why financial education should start early in SA

South Africa's youth are navigating a complex financial landscape marked by high unemployment, limited financial literacy, and the proliferation of digital credit options. As of the first quarter of 2025, the youth unemployment rate (ages 15–24) stands at a staggering 62.4%, reflecting the challenges young people face in securing employment. This economic reality underscores the urgency of equipping teens with financial knowledge to manage scarce resources effectively.

Compounding the issue is the rise of "Buy Now, Pay Later" (BNPL) services, which have gained popularity among South African consumers. BNPL payments are projected to grow by 16.7% annually, reaching $717.3 million in 2024. While these services offer short-term purchasing power, they can lead to long-term debt if not managed responsibly.

Financial literacy among South African youth remains alarmingly low. A survey by 1Life Insurance revealed that over 50% of young people do not know how to build a stable financial future, and fewer than 30% maintain a solid monthly budget. This lack of financial knowledge leaves teens vulnerable to poor money management and financial pitfalls.

The Importance of Early Financial Education

Financial habits are formed early in life. Children begin developing money habits as young as seven years old. By introducing basic financial concepts during childhood, we can lay the foundation for responsible money management in adulthood.

Take, for instance, a teen who learns to save a portion of their pocket money or part-time job earnings, they’re more likely to carry that discipline into adulthood. On the other hand, a teen who grows up without understanding the value of money may find themselves in a cycle of debt, impulsive spending, and financial stress.

And with the rise of "buy now, pay later" options and easy access to credit, teens today are more vulnerable than ever to falling into debt traps. Without a firm grounding in financial principles, these quick fixes can result in long-term setbacks.

How to Equip Teens with Financial Skills

How do we empower South African teens to make smart financial decisions? Start simple. Financial education doesn’t need to be complex to be effective.

Begin with the basics. Teach them to track income (even pocket money) and expenses; encourage goal-setting and delayed gratification. Lastly, help them distinguish between essentials and nice-to-haves, also known as needs and wants.

Make these lessons relevant to their daily lives. If a teen wants a new pair of sneakers, help them create a savings plan rather than buying them on credit or expecting instant gratification. This not only teaches patience but also shows the value of hard work.

Ensure to use real-life examples they can relate to, like the cost of mobile data, or a concert ticket, to help them understand financial trade-offs.

You can also involve teens in family financial activities. Let them help plan a grocery shop on a budget or compare prices, this teaches financial decision-making and fosters responsibility.

Encourage teens to open savings accounts. Most South African banks offer youth accounts with low fees and parental oversight. These accounts provide a safe environment for young people to practice managing their own money.

And since teens are digital natives, use technology to your advantage. Leverage mobile apps and online platforms that gamify budgeting and financial planning. There are several tools designed to make learning about money fun, interactive, and accessible.

Be Intentional

In many South African households, money remains a taboo subject. Parents often shy away from financial conversations, either to protect their children or because they feel uncertain about their own financial knowledge.

But silence only breeds confusion. Open, honest discussions about money are essential. Share your own experiences, both good and bad, and encourage questions. Creating a safe space for money conversations builds trust and learning.

Financially literate individuals are more likely to avoid debt and build long-term wealth. For a country grappling with inequality, financial education is a powerful driver of progress. It empowers young people to make informed decisions, avoid exploitation, and contribute meaningfully to their communities.

*Chris Coetzee is CEO of FinFix.