Why fads and quick fixes won’t save teenagers from bad money choices

‘Cruel optimism” was coined by American historian Lauren Berlant. It refers to when you take one of society’s big problems with deep systemic causes – such as obesity, stress or financial illiteracy – and offer a simplistic solution positively.

It’s optimistic as it implies a quick and easy answer to a complex problem and is seen as cruel as the solution offered is limited, not to mention short-sighted.

Often, such solutions do not consider the deeper causes of the problem.

It’s in our nature to look for quick fixes. We hastily throw solutions at convoluted problems and are quick to declare “mission accomplished”.

But take a closer look and you will see that such hurried and cursory actions, without a thorough well-examined study, make problems worse.

Take young people’s lack of personal finance knowledge today.

It is an issue as convoluted and insidious as any because of the substantial toll it takes on their future and that of the economy.

In the US alone, the cost of financial illiteracy was calculated at $415 billion in 2020, according to the National Financial Educators Council.

This problem didn’t draw much attention previously, but the coronavirus pandemic and the economic meltdown that followed thrust financial illiteracy into the spotlight.

Many solutions followed: money tracking and budgeting apps, parent-controlled debit cards, online resources, self-help books, mandatory lectures and financial education programmes … the list goes on.

All of these were claimed to expeditiously, effortlessly and – for a small fee – rid society of this problem and save a generation from the perils of bad money choices.

If it seems almost too good to be true, it is. Organisations failed to understand the problem properly before rushing to market lofty claims and promises. They didn’t pay attention to the needs and motivations of those they were purporting to help, they just lectured them on responsible behaviour.

They ignored shaping the mindset of young people while jumping straight into budgeting formulas.

They assumed that what worked for adults would automatically work for teenagers, forgetting that teenagers’ brains work in completely different ways.

They oversimplified and dumbed down the content, not understanding that nuance and complexity are interesting and engaging, not to mention a more realistic representation of the issues at hand.

They believed that personal finance could be summarised in a few quick tips, not recognising that doing so undermined the very learning they were hoping to impart.

They fell prey to the myth that teenagers need to be entertained with short punchy videos, even though only profound engagement would bring true behaviour change.

They overlooked the way the content was taught to young people, undervaluing the use of a tried-and-tested methodology to ensure that the content was delivered most effectively.

They delivered a “McProgramme”, identical irrespective of who it was being delivered to, not realising how important it is to personalise the content and learning experience to the learner.

They, like much of the education system, focused on telling the youngsters what to think, instead of showing them how to think.

All this didn’t dampen the profits or valuation of these organisations, it just failed to solve the underlying problem.

We cannot afford to delude ourselves into complacency. The younger generation deserve better.

We shouldn’t be so quick to mortgage their future for a fleeting feeling of self-satisfaction. We need to stop looking for quick fixes.

We owe it to youth to understand the prevailing issues better and to plan our offensive with more forethought.

We have to resolve to deal with not just the symptoms, but, more importantly, the deep-rooted problem.

For it is only by deeply understanding a formidable problem that we can ever hope to overcome it.

Providers of financial education to the young need to ask themselves who they’re really in the business of serving