The 3 key things to teach your kids about superannuation

Explaining financial concepts, like superannuation, to your kids can be difficult, especially when you’re unsure how the rules apply to kids.

In a study conducted by the Australian Taxation Office (ATO), one in five Australian parents said they did not feel confident explaining tax and superannuation to their child. That’s despite the fact many parents realise that empowering their kids with knowledge about superannuation can set them up for greater financial security in the future.   

Interestingly, although 73% of parents surveyed believed that teaching kids about superannuation should start at home, 54% had not broached the subject with their child. 

If you’re not sure where to start, here are three key lessons to teach your kids that can turn them into ‘super heroes’.


1. Start with the basics – explain what a super is and how it works

Understanding how superannuation investing works is the first step. So you should explain:

  • What a superannuation fund is and how it will prepare them for retirement

  • What an employee super contribution is versus their own voluntary contributions, and how they can capitalise on both to maximise their retirement savings

  • How super is invested

  • How tax applies to superannuation

You may think these topics are too complicated for children, but they’re fast learners and able to grasp complex topics surprisingly quickly.

2. If your child has a job, open a super account for them 

Kids may be eligible for superannuation if they work more than 30 hours per week. 

With their own super fund, kids can put the theory they learned into practice. They’ll be able to add money to the fund, track the fund’s growth and set super savings goals.

A saving and budgeting app, like the FLX App specifically designed for kids, can be an excellent way for kids to save money towards superannuation. Kids can create a savings goal called ‘Superannuation’ and regularly transfer money into that goal. 

3. Explain why they’re not too young to start saving for retirement

The power of compounding is one of the most important financial lessons you can impart to your children.

For a child, retirement seems far away. Putting money away for old age probably won’t make sense to a 10-year-old. Spending their pocket money on items that provide instant gratification may seem more attractive.

For it to make sense, you need to show them how compounded wealth works. Here’s a simple example. Have them add a coin to a jar every day and match it cent-for-cent. By the end of the week, they would have doubled their money. Seeing their money grow teaches them about the power of compounded wealth. The earlier they start, the greater the reward. has an educational module with practical exercises and case studies to help teens learn to understand and manage super funds. They can also use the compound interest calculator to calculate projections on how much savings they could accumulate when starting a retirement fund earlier versus later in life. 

It’s never too early for kids to start saving for retirement. FLX provides kids with a fun platform to manage their money and support their savings goals. Get started by signing up to FLX here.

This is general advice. Read the PDSs & TMDs at before deciding if FLX is right for you. The FLX Services & Flexischools are provided by InLoop Pty Ltd ABN 27 114 508 771 AFSL 471558 (trading as Flexischools). The FLX Prepaid Mastercard is issued by EML Payment Solutions Limited ABN 30 131 436 532 AFSL 404131 pursuant to license by Mastercard Asia/Pacific Pte. Ltd.


3 ways to put aside money for your children


Girls Day Out in STEM: The Digital Country Fair Quest!