The holiday season is the perfect time for kids to begin thinking about – and practice managing – their finances.
Between shopping Black Friday deals and crossing off wish lists for loved ones, young shoppers have plenty to purchase at the end of the year. While some may think consumers under 18 only deal with chump change, a recent Cornerstone report found that Gen Z’s spending power reached an estimated $360 billion in 2021.
In 2023 alone, Gen Z consumers are expected to spend $1,275 during the holidays, 22% more than they spent in 2022 and the largest percentage leap of any age group year-over-year. Together, these figures indicate that young consumers have a growing impact on the economy, especially around the holidays.
Furthermore, 33.6% of teenagers got a job in the summer – and we can expect that trend to continue through the end of the year. As numerous teens head into the holiday season with a job – for some, their first – and money in their checking account, they will likely need extra support in navigating how to manage their own finances, especially with holiday scams and strategic holiday marketing threatening to make shoppers overpay or lose hard-earned money.
With the holiday season officially here, banks and credit unions can give young consumers – and their account-holding parents – the gift of financial literacy and education.
Putting a Bow on Financial Literacy
When considering financial literacy, teaching new consumers basic financial terms and fundamentals is often what first comes to mind. However, giving kids the opportunity to practice managing money earlier – what we call financial “experience” – can help instill responsible spending habits from an early age.
Many parents use an allowance system or fake money to mimic budgeting to help their kids manage money. Financial institutions can take this approach to new heights by giving families a platform to manage real finances in a parent-controlled environment.
By introducing a white-label family digital wallet into their banking platform, banks and credit unions can help kids spend, save, donate, and invest during the holidays and beyond.
Retaining New Consumers: The Gift That Keeps on Giving
By engaging young consumers with a family digital wallet at an early age, banks and credit unions stand to retain customers and members even after the holidays are over.
The Cornerstone report also found that once a bank has acquired a customer, they typically stay with that bank for many years. U.S. adults, on average, have used the same primary checking account and savings account for 17 years.
Offering a family digital wallet can retain the parent of the young consumer, as well. According to Cornerstone, banks can more than double their customer tenure by offering two products instead of one.
By investing in a white-label family digital wallet solution, banks and credit unions can engage lifelong customers and members.
Integrate a White-Label Family Digital Wallet
REGO’s family digital wallet gives families the space to practice spending, saving, investing, and donating money in a safe, parent-controlled platform.
REGO’s family digital wallet can integrate into a bank or credit union’s existing platform or app, or they can customize REGO’s standalone, white-label app with their institution’s branding. Whichever option they choose, each transaction is safe and parent-controlled.
As the only certified COPPA and GDPR-compliant family digital wallet on the market, REGO is an expert on children’s banking privacy laws and can help financial institutions navigate the complicated regulatory landscape.
To start offering family banking to parents and their kids, set up a demo with the REGO team, and give customers and members the greatest gift during the holidays.