Ellie and Josh Gwilliam are involving their daughters Abigail 13 (left), Lottie 15, (right) and Johanna,16 (not pictured) in some of the smaller financial choices.
Ellie and Josh Gwilliam are involving their daughters Abigail 13 (left), Lottie 15, (right) and Johanna,16 (not pictured) in some of the smaller financial choices.
Report reveals Kiwi kids are losing experiences but gaining financial literacy through the recession.
Psychologist says the recession will shape how children choose to save and spend in the future
Experts urge parents to talk to children about budgets in a positive and age-appropriate way
The OneChoice Kiwi Parenting report 2024 found nine out of 10 Kiwi households were impacted by the cost of living crisisand concerned with the impact of it on their kids.
Close to half of the parents surveyed said they had cut back on their groceries and reduced their entertainment spend.
Activities they offered their children had also changed because of budget restrictions.
Paediatric psychologist Clare Rowe told the Herald these adjustments echoed patterns observed in previous recessions.
“During economic downturns, families tighten their budgets, prioritise essentials, and delay or reduce discretionary spending,” she said.
“These shifts in financial behaviour can have both immediate and long-lasting effects on children’s attitudes towards money and resources.”
Children could lose valuable education and social experiences when budgets were tight but restrictions could also teach financial responsibility Rowe said.
The report, in partnership with Australian research group MyMavins, surveyed more than 500 Kiwi parents of children up to 18 years of age.
Other parental concerns identified in the report were bullying at school, stress, internet use, and safety.
Despite the recession, most parents surveyed were still positive about their overall financial future with two in three saying they were “reasonably confident”.
Rowe said that cash struggles during recessions can bring positive lessons for children that would help them in the future.
“From past recessions, we’ve seen that children who grow up during these times may become more financially conservative and risk-averse,” she said.
“They often develop a heightened awareness of financial security and may place greater emphasis on saving and investing.”
Turning it into a lesson
Northland mother Ellie Gwilliam had turned the cost of living crisis into a valuable financial lesson for her three teenage girls.
She and husband Josh involved their girls in the recent decision to reduce their streaming services.
“It’s good to give children some choice and for their voices to be heard but with the adult making the final decision,” she said.
“We decided together to keep Disney+ and get rid of Netflix and suffer through the ads on the free version of Spotify.”
The cost of living crisis meant there had been more conversations about finances, including explaining how a mortgage works.
The content editor for the Parenting Place said it was important to keep talk “age appropriate” when discussing finances with children or in front of them.
She said ensuring they were not stressed or burdened with things out of their control was important.
Ellie Gwilliam, pictured with daughter Abigail,13, said keeping financial talk "age appropriate" was important so children were not burdened.
“But it is also important for them to know there is not an endless supply of money - to do that would be doing them a disservice.”
Saving up for something and “delayed gratification” was also a positive, she said.
Parents surveyed in the report said they were having open conversations about money with their kids at home.
Parents had involved children in spending decisions (22 per cent) and were educating them about finances (30 per cent).
Most parents said they were teaching their kids useful lessons around budgeting and saving and 56 per cent had started savings accounts for them.
Although 39 per cent felt it was better than it used to be, 31 per cent believes it was worse.
Parents were divided about how artificial intelligence (AI) will impact the next generation of the Kiwi workforce, with a third anticipating an overall positive effect and a fifth expecting an overall negative effect.
Kirsty Wynn is an Auckland-based journalist with more than 20 years experience in New Zealand newsrooms. She has covered everything from crime and social issues to the property market and consumer affairs.
