Love your kids? Teach them financial literacy!

According to the World Bank and Standard & Poor, only about 33% of the world’s adult population are financially literate. In other words, only 33% of adults worldwide understand how money works, which enables them to make informed and effective decisions with their financial resources.

If you’re reading this article, you might form part of the 33% who doesn’t recognise that money makes the world go round or understand how to make and work with your money. The sad thing is that financial literacy is probably not something you learnt at school. And yet, imagine how different – and simpler – your life could have been if you had gained insight on how to work with your personal finances when you were a child.

It was exactly this realisation – that kids aren’t taught enough about money and personal finance management – that inspired Kathryn Main to start Money Savvy Kids, an organisation that teaches kids that “money is something to be understood and respected”. When she realised that her own son quickly picked up on financial management principles and grasped financial literacy concepts with ease, Kathryn started focusing on teaching other young kids about money matters too.

It comes as no surprise that young children are natural and savvy money ‘managers’ if you consider the fact that children’s neural pathways develop rapidly between the ages of 4 and 12 years – making it the ideal time to teach them about these essential life skills that will set them up for long-term success.

Alan Greenspan famously stated that “the number one problem in today’s generation and economy is the lack of financial literacy”. Money Savvy Kids believes in combatting this crisis by empowering all kids from a young age. Join us in the financial literacy revolution and visit www.moneysavvykids.co.za today.

Budget for the Holiday season

South Africa is a buy-now, pay-later society. The effects on young people’s financial literacy are thus characterized by the same behaviour patterns as parents and society. These are high credit and high consumer behaviour with very little savings, and in turn high social risk behaviour. Money Savvy Kids(MSK) is working to change this disastrous pattern

Per the National Credit Regulator, about 10.3 million South Africans are finding it difficult to meet their monthly debt repayments. Octogen, which specialises in financial wellbeing, reports that in 2016 the average household spent a massive 49% of after-tax income on monthly debt repayments making it ‘difficult’ to ‘impossible’ to keep up with their debt repayments.

Far too many South African consumers go into the festive season saddled with debts they can’t comfortably repay, and with little or no savings and after a holiday spending spree, end up even worse off in the new year.

MSK is not just a product. It is a pathway to developing mind-sets that will ensure South Africa’s children not only work their way out of poverty, but that they have the tools to stay out. On that note, we are offering tips to smart spend this holiday season and have a no worry start to the new year.

  • Set a budget for holiday season expenses like presents, gifts and entertainment
  • Budget for January expenses like school uniforms and stationery and do your back-to-school shopping before your holiday shopping.
  • Don’t spend what you don’t have! Don’t shop on credit
  • Gifts are a huge expense. It takes courage not to overspend! Work out some guidelines around buying gifts with your extended family. Once you know who you are buying for, budget an amount per gift, and stick to it.
  • Don’t be tempted to buy anything other than what you’ve budgeted for. Avoid the impulse purchase!
  • Keep in mind the old cliché that it’s the thought that counts. Something small and personal, something homemade, or even a heartfelt card, will be well appreciated.
  • Spend time with friends and family, for instance. If you’re a highly social person, it’s tempting to play host all season. You can just as easily be the life and soul at someone else’s party!
  • If you are entertaining, don’t be afraid to ask your guests to contribute. Ask each guest to bring along a salad or contribute a dish, and everyone should bring their own drinks.
  • Making your own decorations (or swapping old ones with friends and family) can reduce costs and be a lot of fun for the whole family.

With a bit of planning which involves budgeting and a lot of smart spending you will step into 2017 debt free and maybe even with a little bit of extra cash in the bank!

Start planning now and smart spend, and live within your means!

Budget for The Festive Season

black-friday

Originally an American tradition held every first Friday after Thanksgiving, Black Friday has become the biggest sales promotion on the planet and South Africans are in for a treasure trove of bargains this November.

For those on a budget for the festive season and planning to stick to it, 25 November may be the Christmas shopping event you have been praying for. Marked as the kick-off to Black Friday deals, this is a one day affair happening across the country. This year marks only the third year since Black Friday has come to South African shores with food retailer, Checkers, being the first to offer promotions at slashed prices in 2014. In preparation for the start-off date, retailers have begun advertising their deals for 2016.

For those of you who have left the shopping list budget to the last minute and are looking to buy in bulk for the financially tough months that will follow, Checkers is the store to be. This retailer is known to offer everyday grocery products at ridiculously low prices on the day. In their 2015 Black Friday promotions, the store offered a coffee machine and OMO washing powder at half price. For those who are looking to outdo themselves with present giving this year and do it on a budget, Game is one store to check out. With the retailer having an array of electronics for kids and adults alike, saving will be in your Christmas future no matter what. Other retailers that are offering Black Friday deals are Dis-Chem, HiFi Corp and Takealot just to name a few.

When it comes to budgeting in any season, Money Savvy Kids (MSK) encourages the creation of a list of all purchases beforehand. It may seem tedious at first but it helps stop the urge to go overboard with your Christmas shopping and keep to the budget set out in the beginning. South Africa may not celebrate Thanksgiving but consumers will come out on the other side of Black Friday thankful for one thing: Keeping to a festive season budget.

So, in the spirit of Black Friday MSK is offering its own half price deal. Buy a MSK grade specific course and only pay half price. There will be afternoon lessons at our training facility in Bryanston 5 days a week between 2 and 5. Courses start running at the beginning of February.

For more information please email kathryn@moneysavvykids.co.za/ 079 3700 601

A Money Savvy Christmas

“When I was young I used to think that money was the most important thing in life; now that I am old, I know it is.” Oscar Wilde speaks a truth that echoes throughout many people’s lives today. And it is young children who are not taught to respect money, in particular, that are affected by this timeless and unchanging reality.

Research shows that the curriculum taught in schools today is currently failing many children when it comes to delivering adequate financial education. Money Savvy Kids (MSK) is a financial literacy program. We focus our curriculum around entrepreneurship, financial literacy and social entrepreneurship. That is your child’s best chance at enhanced understanding when it comes to money matters. We endeavour to bridge this gap with the MSK program through our online courses and classes held after-school hours.

The ability to spend wisely is not inherited. It is a skill that is learned throughout one’s life. Beginning at an early age, the ability to spend money correctly can be ingrained into your child through countless ways. Christmas is one great avenue of instilling these skills. With an abundance of specials that are expected to descend on all of us this festive season in all major stores across the country, involving your child in the process of choosing a present is a way to do this. It is expected that the majority of the stores do carry the item your child will choose and will sell them at different prices. Involve your child in this process in order for them to see how they can get a Christmas gift at a lower price. This will allow them better understand that they can save and have fun in the process.

Recognising this, we strongly encourage the involvement of children as young as six-years-old into our program. The MSK financial curriculum ranges from grades 0 to 7, and combines real-world education with easy-to-understand modules to further develop children’s learning. With this in mind, believe in your child’s ability to understand and involve them in the Christmas spending duties.

Stokvels as a Saving Method

MoneySavvyKids is a financial educational curriculum that is set to educate children and parents about saving, spend, tax and Budgeting and many more saving and investing methods.

Stokvels is one of the oldest saving method used by people as a means of saving money. There are many Stokvels associations in South Africa that you could join in order to save and invest money.

Stokvels are group savings schemes providing for mutual financial assistance as well as social and entertainment needs.

Stokvels are seen as a traditional way to save as it is safe and has been around for many years. The name “stokvel” comes from the term “stock fairs”, as the rotating cattle auctions of English settlers in the Eastern Cape during the early 19th century were known.

Stokvels are request of only twelve or more people per club functioning as a rotating credit unions or saving system in South Africa. Members contribute fixed amount of money to a central fund on a weekly, fortnightly or monthly basis.

Stokvels usually have a constitution which dictates the size of the contributions, when the accumulated money is to be paid out and the roles and responsibilities of the members. Each month a different member of the club receives the money in the fund, which was collected during that period. Defaults on contribution are very rare as other members will know if one person haven’t paid your contribution, and also because there are regular meetings held as they are a reminder of what you will gain when it is your turn. Depending on the type of stokvels, the members can use the collected fund for their own use, for payment or investment purposes.

These take different forms depending on the purpose of the scheme… ranging from burial stokvels, savings/money stokvels, grocery stokvels to investment stokvels to birthday celebration stokvels. Burial stokvels have higher membership and are highly concentrated competed to the other stokvels according to stats.

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It is estimated that one in every two adults in South Africans is a member of at least one of 89 000 stokvels or investment system. Black adult South Africans invest approximately R12 billion in stokvels a year.

‘’Stokvels are a strong market in the area of traditional collective saving, and are estimated to be worth R25 billion. There are 8.6 million stokvel members in South Africa which represents 23% of the adult population and an estimated 421 000 stokvels in total.” This is according to African Response’s latest survey on the status and market potential of stokvels.

Contact Person:
Name: Kathryn Main
Position: Managing Director
Email address: kathryn@mainmultimedia.co.za
Phone: +27 (0)79 3700 601

Why are we in such debt?

The internet loves making lists of things, from top 10 beaches you have to see, to the top 10 restaurants in your area. So it’s no surprise that there’s a list of the top 10 reasons why people fall into debt. Some are fairly obvious, some are a little more excusable and one is absolutely ridiculous.

Bankrate.com’s list of the top 10 leading reasons for debt starts off with reduced income/savings. That stands to reason. Next up is divorce, followed by an important one, namely poor money management. The list goes on through unemployment, gambling, medical expenses, saving too little, no money-communication skills, banking on a windfall and finally, yes – FINALLY – financial literacy.

It’s no wonder that as South Africans, 70% of adults are in debt when ‘financial literacy’ comes in at number 10. It begs the question, if financial literacy was at the top of the list, would there be a list at all? There are glaring inadequacies in the education system, from junior school right the way through to tertiary education that does not include any sort of formal financial literacy.

The lynch pin of education is that, when done correctly, can eradicate an abundance of unnecessary shortfalls when education is lacking.

There is no use in trying to solve our financial problems if we don’t understand finances in the first place. Our lack of financial literacy in this country breeds a society that is constantly playing catch up with their finances and, worse still, putting out fires constantly.

Until we see a shift in paradigm that sees financial literacy (or lack thereof) as the number one cause for debt and financial instability, we’ll spend our lives reading about the top 10 beaches to visit, as opposed to going to see them for ourselves as a result of our financial instability.