There seems to be an app for everything nowadays.

From shopping and dating, to pet grooming and fuel refills, you needn’t get off the couch anymore.

A few taps, swipes and scrolls, and you’re sorted.

Easy peasy. No sweat. And a smaller carbon footprint.

Recently there has been a veritable explosion in the number of money apps/ digital offerings trumpeting claims about teaching kids & teens good money behavior.

From budgeting and investing apps to digital debit cards, they proclaim to (choose the tag line that resonates most with you):

  • financially empower kids
  • raise financially smart kids
  • teach kids money management and investing fundamentals with real money
  • teach kids to earn, save, spend and (wait for it) invest

Just download and hold your breath.

Sounds lovely doesn’t it? Three cheers for the fintech industry for tackling this monstrous issue? Can we all pack our collective bags and rest easy knowing the financial future of the next generation is in safe hands?

Not so fast.

Let’s take a damn minute to really look into what’s at play here.

These apps and digital offerings are great at their core purpose which is facilitating the digital transfer of money from parents to kids, helping kids to spend that money both online and offline securely, while enabling parental tracking and controls.

That’s it.

They do not, magically or otherwise, turn an overspending, financially clueless kid into a money whiz, never mind a savvy investor.

This would require a monumental leap in logic.

Teaching kids to spend money, even if they do track their spending diligently, isn’t financial literacy. Financial literacy and teaching kids how to make smarter money decisions is a lot more nuanced than that.

And this then exacerbates the Dunning Kruger effect, a cognitive bias in which people with low ability at a task tend to overestimate their skill. So you have kids with limited to no understanding of how money really works, now overestimating their ability to make smart money decisions.

Are we beginning to see how dangerous this can be?

“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so. “ — Mark Twain

These money apps do undoubtedly have value; and can serve to power up their users knowledge and ability, and save time, but if and only if the users are already financially responsible and knowledgable.

And therein lies the rub.

Sidestepping this crucial caveat isn’t serving the kids and teens, or their parents.

There is no easy fix. No allowance tracking, budgeting app or debit card is the likely to be the silver bullet here.

We should stop being in such a hurry to identify one.

Parents and educators still need to get down into the trenches and carry out the time consuming, highly complex, yet infinitely rewarding task of teaching kids & teens how to model good money behavior and make smarter money decisions.

We need to take the time to change and mould their mindset around money.

We need to talk to them, answer all their wonderful questions and help to clarify their thinking around money.

We need to develop their competence around money through deep learning and regular guided discussions, and ensure that this then positively impacts their thinking and behavior.

There is, at the time of this writing, no app for that.