By Tobie Van Heerden, CEO at 10X InvestmentsIn an era where financial literacy is becoming increasingly critical for navigating life’s challenges, there remains a concerning gap in young people’s understanding of money management, budgeting, and long-term financial planning. In fact, more than 50% of South Africa’s youth lack the financial literacy needed to build a strong financial future, according to insurer 1Life’s generational wealth youth survey.
This is a particularly pressing issue when faced with the high levels of youth unemployment in the country. Youth unemployment (ages 15-24) levels are currently significantly higher than those of older age groups, sitting at 60% in the second quarter of 2024 according to Statistics South Africa, with unemployment for those within the age group of 25-34 at 41.7%.
However, one avenue that has shown promise in addressing this issue is sports. The intersection of sports and financial literacy presents a unique opportunity to educate and empower youth, equipping them with essential life skills that extend far beyond the field or court.
Sports have always been a universal language that transcends socioeconomic boundaries, gender, and geography. For many young people, sports are not just an extracurricular activity; they are a way of life. Leveraging this natural interest can be an effective way to introduce concepts of financial literacy in a way that is engaging, relatable, and actionable.
A powerful tool for education
In South Africa, sports play an integral role in every community, often becoming one of the few avenues available for young people to excel while providing a sense of belonging, identity, and hope.
This strong connection between communities and sport is rooted in the role that sports play as a universal equaliser and an accessible platform for personal and communal empowerment. This makes sport a powerful tool for social change, offering pathways to education, career success, and personal growth that would otherwise be difficult to attain.
These same principles can be applied to personal finance
From managing a team’s expenses to organising fundraising efforts, sports teach participants how to allocate resources effectively. This can segue into lessons on personal budgeting – distincting between needs and wants, tracking expenses, and understanding cash flow. And, just as teams plan for future seasons and players work towards long-term goals, financial literacy programmes tied to sports can introduce the concept of long-term financial planning.
Furthermore, as young athletes advance to higher levels, they often engage in contract discussions and negotiations. This offers a real-world introduction to financial concepts such as income, taxes, and the importance of reading legal agreements—skills necessary for managing one’s finances responsibly in adulthood.
Leading to financial success
Investing in youth leadership early on is critical for building a foundation of financial literacy and future career success, as it equips young people with the skills, confidence, and knowledge to make informed decisions and take control of their financial futures. Sports, in particular, is an ideal vehicle for fostering leadership, as it naturally instils values such as discipline, teamwork, and strategic thinking – all essential for navigating both personal finances and career development.
Recognising this, 10X has sponsored initiatives that not only provide young people with access to sports but also empower them with leadership skills that can positively impact their futures, families, and communities through Paul Roos Gymnasium, Bishops Diocesan College, and the Vusa Rugby and Learning Academy, which offers support and mentorship to the underprivileged community in Langa through structured academic, sports and extramural programmes.
The ripple effect of future empowerment
Financial literacy is the knowledge and understanding of key financial concepts, such as budgeting, saving, investing, managing debt, and planning for the future. It equips individuals with the skills needed to make informed and effective decisions about their finances, helping them navigate life’s financial challenges and achieve financial stability and security. Being financially literate empowers people to take control of their financial well-being and avoid common pitfalls like overspending, excessive debt, and poor financial planning.
This empowerment extends beyond the individual, benefiting their families by improving household financial management and creating opportunities for upward mobility. As financially literate youth contribute to their communities, they foster economic growth and financial resilience, ultimately shaping a generation that is better equipped to break cycles of poverty and build lasting wealth.
Financial literacy is not just about making effective personal financial decisions – it’s about fostering a generation that can contribute to sustainable economic growth. Ensuring that the youth are able to sustain a healthy financial future is critical as this young demographic stands on the precipice of inheriting and shaping not only South Africa, but the entire continent’s economic landscape.
The content herein is provided as general information. It is not intended as nor does it constitute financial, tax, legal, investment, or other advice. 10X Investments is an authorised Financial Service Provider# 28250 and S13B Pension Fund Administrator #24/444.
