How Do We Teach Children About Financial Education?
How do we teach children about financial education (FE)? Is it about acquiring knowledge or is there something more to it? Would we have more financially literate adults if it were just a case of knowledge? If that were true, there would be a higher percentage of adults who are financially better off. The amount of information and education on the internet is mind blowing yet many adults are still in the unknown.
So perhaps the problem is not information.
A few years ago, I was hiking in Nepal. Even above 4000 metres, there was rubbish scattered along the trails. It shocked me. How can this happen when environmental awareness is so widespread? Information about conservation is everywhere, yet behaviour tells a different story.
The issue is not ignorance.
It is behaviour.
Discarding rubbish on a mountain trail is not so different from keeping money idle in a bank account for decades despite knowing about inflation. In both cases, the individual has access to information, but behaviour does not align with the information
So how do we educate beyond the transfer of information?
If behaviour is shaped not only by individual choice but also by culture, social norms, conformity, and economic systems, where does responsibility begin and end? Take the financed car. On paper, it appears financially inefficient: paying monthly for a depreciating asset you do not own at the end, but 8 out of 10 cars in the UK are financed. Why?
Education must go deeper than the transfer of information. Information sits at the surface. Beneath it lie time, emotion, identity, social influence, memory, and experience.
Behaviour and Learning
If financial education is about behaviour, we must first understand what behaviour is.
Psychology gives us useful lenses.
Ivan Pavlov described behaviour as observable responses to environmental stimuli. Behaviour is conditioned. It forms through repeated associations between situations and emotional reactions.
Albert Bandura argued that behaviour is socially learned, shaped by observation, imitation, and belief. A child who grows up watching parents argue about money may internalise anxiety long before understanding budgeting.
Jean Piaget suggested behaviour reflects cognitive development. A child’s financial behaviour will depend on their developmental stage, what is reasonable at six is different at sixteen.
These three examples give a nice rounded definition of behaviour and questions nature vs nurture, society vs the individual.
What Is Learning?
If behaviour is shaped, how is it reshaped?
Lev Vygotsky argued that learning occurs through social interaction. A learner can only progress so far alone. Within the Zone of Proximal Development, learning is deepest when guidance is present and support is gradually removed.
A child can learn to budget far more effectively when planning alongside an adult.
Jerome Bruner described learning as discovery. Concepts are not simply received, they are uncovered.
Rather than telling a child that saving is good, allow them to discover how money grows over time.
John Dewey emphasised learning through doing and reflection. Education must connect to lived experience. Giving a child responsibility over small financial decisions teaches more than a worksheet ever could.
Giving children responsibility over small financial decisions builds deeper understanding than a maths problem on a worksheet.
The Landscape of Current Financial Education
Between the books, youtube videos and short courses the majority of FE is the passing of information. They call for you to act as an individual. Dave Rasmey says save $1000 before you do anything. Robert Kiyosaki says the rich don’t work for their money. But still the learner is on their own. The learner has read the book, now it is time to act! It is here where the learning process begins and financial education fails.
The Missing Link
Financial education today is not lacking in information or structure. Whether one follows the principles of Dave Ramsey or Robert Kiyosaki, there is no shortage of systems, steps and frameworks.
The learner may have taken responsibility to purchase the book, download the course, or attend the seminar. But responsibility alone does not equal readiness. Without mentorship, feedback, or social reinforcement, the learner is left to navigate complex financial decisions independently. There is no guidance as to how long they should remain at a particular stage, whether they are operating within their capability, or whether they are moving too quickly.
From an educational perspective, this is problematic.
John Dewey argued that learning comes through doing and reflecting. Yet some financial “doing” carries consequences that are far from educational and very difficult to reverse. Financing a car, for example, is not a small classroom experiment. It is a binding contract with long-term financial implications.
This raises another question: where does the author’s responsibility begin and end? If a book were poorly written or fundamentally flawed, it would likely fail in the marketplace. What may be “good debt” for one individual may be bad for another. What is empowering for one reader may overwhelm another.
Here, Albert Bandura becomes especially relevant. If behaviour is shaped through social learning and past experiences, then no two learners arrive at financial education from the same emotional starting point. Consider the child who grew up watching their parents argue about money. Anxiety becomes associated with financial risk. As an adult, they may keep their money in the bank for decades, not from ignorance, but from conditioned fear. When they finally turn to a Ramsey-style system, they may understand the logic but feel paralysed when choosing between mutual funds, ETFs, or cryptocurrency.
Financial education provides structure, but it often assumes a psychologically neutral learner. It offers strategy, but rarely scaffolding. It delivers principles, but not always guidance calibrated to the learner’s developmental and emotional context. Of course how can it? The book is meant to sell and apeal to most.
Incentive structures
This is to say nothing of the fact that the financial products that are offered always benefit someone else more than the customer. The incentive structure can be distorted so much so that the learner is blind to the consequences. The financed car for example is a perfect example. The dealership would not be offering it, if it benefited them more than the customer. The customer is not in a neutral decision making environment, they are surrounded by the now social norms and the Jones’ next door.
Where do social influences start and stop?
Individuals do not make decisions in isolation. Past experiences, emotional conditioning, and personal beliefs are just one side of the coin. The other is the social landscape, norms, culture, systems, and economic structures.
Financial education assumes that the learner acts alone without any internal or external influences. What they miss is that the learner has already developed their behaviours through ‘learning’, which is why they are in the position they are in and the way to unlearn or relearn is to relive their past experiences but applying the FE book.
Financial education often attempts to overwrite behaviour with information. But behaviour was written through experience. Experience cannot be changed by instruction alone. It must be replaced by new experiences.
Final thoughts: Children and Finacial Education
What interests me more is the financial education of children. If adult FE is about relearning lessons or being exposed to new ones then what does that look like for children?
Financial decisions are not made in a vacuum. They are made inside emotional histories, social pressures, cultural norms, and institutional incentive structures. By the time a learner opens a financial education book, they have already been financially educated, by their family, by advertising, by peers, by fears and by aspirations.
Teaching a child about the stock-market or how derivatives work is not the first lesson they should be learning. They should be learning about calm decision-making, experiencing small financial risk, guiding them through the discovery of borrowing money, emotional regulation/stress and learning about patience.
The first question I asked at the start was ‘How do we teach children about education?’
this should be changed to
‘What kind of financial culture are we creating for them?’
Workshops
Here I would like to offer you the opportunity to do just this. To support you in creating a finanical culture for your child.
Click here if you would like your child to take part in a series of workshops that cultivate their experience of money. Alongside monthly sessions for parents and children there will be practical tasks and reflections for your child to take part in, to give them not only the information, but a lived experience.
I look forward to hearing from you.
Donation
If you enjoyed this, I would be very greatul if you could donate something towards the time taken to write a post like this. I want to keep writing post like this, that explore different facets of education and your donation can help me. Thank you!
