The Australian states have steadily discontinued the CBA’s dollarites program after an ASIC review found it did not improve children’s financial literacy. (Source: CBA)
Concerned about the death of the dollarites? Do not be so.
But let me step back a little and explain what happened.
Late last year, the corporate watchdog ASIC released a highly anticipated report on school desk programs and their benefits or otherwise for children.
The results were devastating. Not only has it been said that programs are of “limited value” to our little ones, but it has also been concluded that they have exposed “vulnerable consumers” to elaborate marketing techniques.
Interestingly, it also found that participation in such schemes did not create a lasting habit of saving. Not exactly the point!
In fact, one of the biggest players, Bendigo Bank, shut down its school desk program in anticipation of the ASIC report. The Dollararmites operator CBA had vowed to work with regulators to make its program more valuable to children.
But the situation resolves quickly.
What’s the latest development?
Queensland became the last state to ban businesses from our children this week, following the steps of Victoria and ACT.
Dollarmites’ contract will not be renewed if it expires in July.
Don’t forget that aside from ASIC’s most recent decision, ABC coverage had previously revealed the scale of the setbacks the CBA is paying for access to our children.
In 2017, schools and parent and friend associations received around $ 400,000 for children opening accounts and depositing money with them.
Meanwhile, Nine Media’s coverage had also misled the CBA employees who had fraudulently activated child accounts by depositing their loose change into them to earn generous bonuses.
This is all a function of the fact that the CBA was previously a government agency and the work of raising children was adequate. It is now a 100 percent commercial entity. And our schools shouldn’t be the lucrative funnel for customer acquisition.
My Interest Integrity Index, published here by Yahoo Finance, found that the big four banks charge a total of $ 185,000 in net interest income if you stick with them as an adult for every debt product.
The story goes on
Research by Consumer Advocate Choice also found that 46 percent of people open their first bank account with CBA. Every third person still has this account.
And that’s why banks strive to “educate” future adults.
So, with the dollarites dying after more than 80 years, almost sure who will step up to prepare our children for success?
Independent financial literacy in schools
Little do parents know that teaching in Money Smarts has been part of the Australian school’s curriculum for more than five years.
Your kids will likely never come home and say, “Hey, we got a degree in finance today,” but that content will be embedded in subjects like math, business, and even English and science.
There are also free pre-made lesson plans for teachers at moneysmart.gov.au to help them cover this important student survivability as easily as possible.
And it works. The OECD benchmark for country performance, the International Student Assessment Program (PISA), assesses the financial literacy of 15-year-olds from 15 countries.
Australia ranked fifth most recently in terms of their ability to understand and apply their knowledge to financial issues. And this result was better than the previous test.
While 15 percent of Australian students were high achievers, larger 20 percent were high achievers.
And that just proves that parents must always move up.
Three Important Lessons Parents Need To Teach
The three main monetary messages that you need to show and convey to your children are as follows:
Lesson 1: In real life, money is earned that is not loaned out … and so should pocket money (I like to assign the money to birthdays between the ages of 6 and 11; then a slightly higher income may be required until your child is born gets a part-time job at 14 and three quarters.
Lesson 2: Even if you rarely see more physical money, it is still running out. You need to assign and spend it carefully.
Lesson 3: Good things come to those who wait. The ability to delay gratification – and accomplish your most precious goals – changes life.
Nicole Pedersen-McKinnon is a Yahoo Finance columnist and longtime “money” commentator across the country. Follow Nicole on Facebook, Twitter and Instagram.
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