The next generation of fintech users will expect more
The “pocket money pay gap” is reversed and the children are investing in crypto – fintech should follow suit.
Image source: Lensi Photography/Starling Bank.
Forget Gen Z and Gen Alpha, “Generation Aspiration” is the new name for tomorrow’s young earners.
They are the children who want to increase their income – even at the ripe old age of seven – believe that it is important to earn their own money, and hope to be their own boss one day.
Created by GoHenry, a debit card and financial app for young people that teaches kids how to manage their money, Generation Aspiration is not only the fintech users of the future, but they are already the fintech users of today.
Seriously, they manage their weekly pocket money on an app and invest in crypto.
GoHenry’s co-founder and COO, Louise Hill, recently joined AltFi on our latest episode of Money Talks to discuss the topic of ‘Fintech for Good’ with Nina Mohanty, Founder and CEO of Bloom Money and Tom McGillycuddy, Co-Founder of CIRCA5000.
All three of our panelists—each incredibly successful founders in the fintech space—agreed that they had little, if any, financial education when they went to school.
Even now, how to pay taxes or start investing is not a topic taught much in schools, despite the fact that 75 percent of young people believe good money management skills will help them with their future skills.
Fortunately, from GoHenry’s Youth Finance Report on more than 450,000 children in the UK, it’s clear that not only is the next generation more tech-savvy, but they’re shaping up to be far more financially savvy.
70 per cent of young people in the UK and US say it is important to earn their own money, and around 40 per cent ‘work’ for their pocket money, whether it’s doing housework or walking the dog.
Increasingly, they are diversifying their sources of income, earning money from home instead of getting “traditional” part-time jobs.
As many as 1.33 million children in the UK (13 percent) earn money by investing in cryptocurrencies.
They are also more environmentally conscious, with a quarter of children and teenagers making money selling things on online marketplaces such as Vinted, eBay and Depop – Depop alone has more than 30 million registered users in more than 150 countries, and 90 percent are under 26 year.
37 percent of children as young as eight hope to start their own business in the future, and 21 percent said being their own boss is a priority for their future career.
Given the tools and knowledge to become more conscious and aware of their finances and what it means to spend and earn money, a new generation of young earners is becoming firmly established.
And these earnings will expect to be fairly paid.
For the first time since the Youth Economy Report began, the “Pocket Money Gap” – exactly what it sounds like – reversed last year.
In 2018 it was 5 per cent higher for boys, but now it is 4 per cent higher for girls (£8.37 for girls against £8.03 per week for boys), marking an overall increase of 9 per cent in girls’ earnings.
Meanwhile, the adults lag behind.
For adults who work full-time, the pay gap between the sexes was 8.3 per cent as of April last year.
Parents have reversed the trend for their children – and we know it’s not just because parents give their daughters more money without putting in the work, even if it’s just doing the dishes.
So what does this mean for fintech?
This means that in the not-so-distant future, Generation Aspiration will have a whole new set of expectations, and fintech companies should be prepared for it.
They will donate to charity and expect green investment options.
They will channel their entrepreneurial spirit and start businesses from their bedrooms, becoming their own bosses in jobs that don’t even exist yet.
They will be the most financially savvy generation we’ve seen, and that should be an exciting prospect for fintech.
