At a time when our daily intake of news is flooded with concerns about the current risk of an ever looming recession and fears about the effects of this credit crunch, spend-happy teens can’t see what all the fuss is about.
Luckily we remain mostly unaffected, but despite not having bills and mortgages to pay off, for our long-term future could there be more serious implications?
Within my own peer group of 17 and 18-year-olds there seems to be financial pressures building already – and this is before university loans begin.
My research found that nearly half (44 per cent) of the 15 to 17-year-olds interviewed by wealth managers AXA plan to get a credit card when they turn 18.
A further 18 per cent are considering taking out a bank loan, and 17 per cent expect to be overdrawn.
Worryingly, the study also found that a significant 70 per cent of teens are unable to stick to a basic budget for just one week.
Considering that university life is all about independence and learning to manage your own money, this is surely a major concern.
Overspending seems to be a growing issue in general for teenagers, and from personal experience the question that many seem to be asking after we have frittered away our pocket money or monthly wages – where has it all gone?
Having a part-time job is a necessity in my eyes, especially as everything seems to be getting more expensive. Whether it’s getting a travel card up to London, a meal out in Bromley or another trip to Topshop it seems to escape from the bank before even considering opening a savings account.
However, while many of us are still at sixth form or college, we are encouraged not to spend our free time earning that extra bit of cash doing overtime at our local supermarket as it seems we all are.
They keep reiterating that we don’t need the money now, we need the grades first to ensure we get into university which will then lead to getting a successful money-raking job.
I also looked at a group experiment set up in a bid to discover the financial acuity of today’s youth - whereby the parent and child roles were reversed, leaving the teens in control of a weekly household budget, set at £248.40.
Only a minority of the participants managed to stay within the limits, with the group overspending by an average of 16 per cent.
One teen missed the mark by a staggering 240 per cent, blowing nearly £600 in seven days.
The majority of teens also failed to keep some money aside in case of emergency, as 65 per cent failed to come to terms with a surprise demand for extra cash from parents.
It made me think, are we really that ill-equipped to cope with finances?
If you posed the question to teenagers about the credit crunch, it may not be seen as big issue but from looking at these studies, it has emphasised to me what a huge challenge budgeting can be when you’re still relatively new to managing money and making regular financial decisions.
Many teenagers are on the cusp of leaving home for university or to get a job and while some will naturally approach money with diligence, this study suggests that they simply may not be able to cope with budgeting effectively.
With the early introduction of debit cards to young teens in particular, the value of money seems to be disappearing as the temptation to spend through a piece of plastic seems too easy to resist.
These things are seen as the norm so that teenagers think they're only doing what is typical in expecting to get into debt sooner rather than later.
At times of global financial crisis, surely the need to educate teenagers about dealing with personal finance is something our schools should consider, because in reality we are all affected in one way or another.
By Vicki Robinson, aged 17, from Bromley
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