Parents remain the biggest source of financial knowledge for teenagers, but social media is playing a bigger role in their financial education journey, according to a survey.
Fifty-seven percent of 318 teens between the ages of 13 and 17 surveyed by Wells Fargo from April 20 to May 3 said they learned about handling finances from their parents.
However, 35% of the respondents said they learned financial lessons from social media, while 34% said online websites and articles were their source.
In contrast, only 12% of the 304 parents surveyed by Wells Fargo believed their teens use social media for financial education.
“There is a bit of a disconnection between parents’ and kids’ perceptions around financial education,” Kathleen Malone, a financial advisor at Wells Fargo Advisors in Charlotte, N.C., says in a statement.
“While 61% of parents polled say they’re talking to their kids about finances, only 43% of teens report they have had these conversations. It’s very important for families to discuss money — and for our next generation to understand how to handle their finances,” she adds.
The survey findings show that teenagers’ interest in investing was boosted by the trading frenzy around GameStop, as well as the continued interest in Bitcoin.
Forty-five percent of teens said they were more interested in investing this year because of the GameStop trading craze, while 45% said they know more than their parents about Bitcoin.
A vast majority — 93% of teens surveyed and 92% of parents — agreed that teens who learn about investing will be better off financially later in life.
But the survey findings show a perceived knowledge gap.
Thirty-two percent of parents gave themselves a D or F grade in investment knowledge, while 49% of teens gave themselves a similar grade. More teen girls (53%) rated themselves lower in investment knowledge than boys (42%).
Sixty-one percent of parents said they have had conversations with teens about handling finances, but only 32% said they talked much about investing.
Some parents have turned to educational activities to help their teens learn more about investing.
That includes 17% of the parents surveyed opening a custodial account and investing on the teen’s behalf, 13% encouraging the teen to play a simulated stock market game and 7% gifting stocks to the teen so they can learn more about the market.
Do you have a news tip you’d like to share with FA-IQ? Email us at firstname.lastname@example.org.