Teach kids the hidden cost of borrowing. It’s in interest, stress, and missed opportunities. Get the mindset, habits, and tip, plus our free downloadable resource
Borrowing can feel pretty harmless in the short term.
“I can just pay it back later.”
But the real cost isn’t actually the loan itself…
For kids, borrowing might look like an advance on pocket money or a small loan from a sibling, but the principle is the same: Every “yes now” can turn into a “less later.”
Debt trades tomorrow’s freedom for today’s fun.
Borrowing feels like a shortcut, but it locks future income into past decisions.
South African consumers need 68% of their take-home pay to service debt, which means most families are already spending tomorrow’s money today. Kids can easily fall into this pattern if they see debt as normal. Helping them understand that borrowing is not free, but that it costs them choice, independence, and peace of mind, goes a long way in developing a healthier money mindset.
Takeaway: Encourage them to ask: “How will this choice affect future me?”
Practice waiting, not borrowing.
Most borrowing happens when people want something immediately rather than saving up for it.
Building the habit of waiting is the antidote. The famous Stanford “marshmallow experiment” showed that children who could delay gratification often had better life outcomes, from academics to health.
The same principle applies to money: kids who wait and save learn that patience preserves freedom. Instead of reaching for credit or a loan, they practice enjoying the anticipation while their money grows.
Takeaway: Teach kids that patience grows freedom — “If I can wait, I won’t owe.”
Let them feel the squeeze of repayment.
Set up a simple exercise: let your child “borrow” R50 from their pocket money with a repayment rule — they owe R5 extra each week until it’s paid back.
So if they normally get R50, the next week they’ll only get R45, then R40, then R35, as repayments eat into their money.
Suddenly, the “free R50” feels very expensive. This makes the long-term cost of borrowing visible and personal, without real-world consequences.
You can also check out a previous Mini Millionaires edition: How to teach kids about debt.
Takeaway: Show kids how debt shrinks their future choices by letting them experience it safely at home.
Market Day is the perfect chance to turn a fun school project into a money lesson that sticks.
Using Fintr’s Market Day Debt activity, kids work out the cost of making their goods (like cupcakes), and then face a choice: save up for ingredients or borrow from a parent with 10% interest.
When the sales are done, they see the difference in their pockets.
Borrowing cuts profits almost in half, while saving keeps the reward intact. It’s a simple, hands-on way to help kids feel the real cost of debt before it matters most.
