Mark Jay (left) and Nicholas Muscat (right) took control of their finances at a young age (Source: Provided)
When Nicholas Muscat was 16, he set a personal goal to save $ 100,000 by the age of 21. At the age of 19 he had made it.
Muscat said he knew very early on that money was important and was determined to achieve his goal.
“I realized at a young age that money is not everything, but it affects most things in life,” said Muscat.
“With money, you can do what you want in life.”
He reached his personal milestone, $ 100,000 in savings, two years ahead of schedule. He said it was a combination of being responsible when buying clothes, eating out and trying your hand at the stock market.
But Muscat’s story is not like that of many other Australian teenagers. A new report from financial advisory and accounting firm Findex found that half of Aussies under the age of 25 feel out of control over their finances.
For 16- to 24-year-olds, mom and dad remain the point of contact for financial advice. 71 percent say they turn to their parents or guardians for help managing their money.
But Muscat learned not to take money from his parents.
“Many people turn to their parents for financial advice, but I learned early on that mine isn’t always in the best financial habits,” he said.
“Often times, they bought new things unnecessarily, threw away items that were still in good condition, or did not compare products and services before buying to ensure they were getting the best deal. Instead, I turned to experts online. “
Muscat said without his parents’ in-depth financial knowledge, the lack of financial education in schools was another hurdle he had to overcome.
“I think financial literacy is incredibly important because education enables independence and independence enables freedom – the freedom to enjoy life to a greater extent.”
“You have to be careful what you read. It is easy to fall for false news and much of the credible advice applies to US markets and doesn’t always apply to Australia. “
Muscat spent a lot of time researching various financial topics and putting the information together into a guide.
The story goes on
And he doesn’t see age as a barrier, but as part of the reason for his success.
“Being young is the greatest asset,” he said.
“My advice to young Australians who want more financial freedom is to start small and start now. It all adds up from saving a little to learning the basics of taxes and super, ”Muscat said.
According to the Findex report, young Australians have shown their ability to save for medium-term goals. Over half (53 percent) of respondents identified the best tactics to save on a big purchase like a new car or a long-haul vacation.
However, when asked how they manage their day-to-day finances, they were less likely to practice financially sound behaviors.
One in four said they never or rarely set a budget, and only 32 percent manage their finances by calculating their monthly income and expenses.
‘Read, Read, Read’: Mark Jay’s Story
When Mark Jay moved to Wollongong University from his hometown of Coleambally, he found it difficult to manage his finances, but luckily his school had offered some form of financial education.
“I switched from a permanent job in Coleambally to no job in Wollongong. There were lots of unexpected costs like public transportation, university facility fees or repairing broken furniture that added up over time, ”said Jay.
Jay said like Muscat he was motivated to gain financial independence early on, which led him to take control of his finances once he started college.
With his financial literacy experience, Jay was able to fund his first year through university without the help of his parents.
“I am very proud of the financial independence that I have achieved so far. I believe financial literacy is essential, ”said Jay.
After attending a business and business administration class in high school, Jay has the building blocks to further develop his financial goals, but noted that not everyone is so lucky.
“If you weren’t in this class, financial education wasn’t in the curriculum elsewhere,” he said.
He is currently studying a double degree in commerce and communications, but much of his finance knowledge comes from reading books and free online educational resources.
“The most important piece of advice I would give to other young people looking for financial independence or learning essential financial skills is to read, read, read,” said Jay.
Make use of all the free resources available and learn about financial concepts if you want to improve your current financial situation. “
Findex CFO Matt Games said that sound financial decision-making is strongly related to financial well-being in later life, which is why financial literacy is essential at a young age.
“While the data shows some encouraging signs that younger Australians are financially savvy, there are also some real areas of concern,” he said.
“While half of young Australians feel they are in control of their finances, that means almost one in two feels in the dark.
“It’s a shame that young people still report that financial education is not part of the school’s curriculum,” he added.
“Having a lot of trust in parents and guardians to educate the next generation about financial literacy is wrong and potentially harmful.”
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