Why early entrepreneurial exposure may solve delayed financial independence attainment among youth


In today’s world, technological innovation, marketing, real estate and human resource are changing how we go about everything. Some processes have become significantly simpler, but some, much more difficult. Unfortunately, attaining financial independence falls among the latter. Society has undergone change that has required more complex decision-making for youths in their pursuit of financial independence. Most young people, specifically those aged 18 to 25 years, struggle to attain financial independence; and this is alarming as financial independence is important in the journey toward adulthood.

Not only is financial independence a desired state for youth, it is also beneficial to their parents and/or guardians as well as some parents spend approximately more than 40 percent of their income on their adult children. In lower income households, this proves a significant burden to the families. However, there’s an even bigger impact that financially independent youths make. A financially independent youth population is an indication of a healthy economy. Why? Well, for starters, there will be a higher number of people with the option of investing their money into profitable and social-impact projects and ventures.

So why aren’t we asking this key question:  How can we innovate different pathways for youths to become financially independent, especially in emerging economies where conditions frustrate the process? Emerging economies, such as Ghana, have high levels of unemployment – and underemployment (people’s skills not being properly applied). This unemployment issue is particularly significant to the problem of delayed financial independence, since the youth usually depend on income received from wages to aid their journey. Lower job opportunities mean lower income/wages, which subsequently delays one’s future state of financial independence.

Thus, in innovating the pathways to financial independence, this is where early entrepreneurial exposure invariably plays an important role. In building habits, attitudes and qualities for the future, it is often undisputed that starting at a younger age is paramount. This is especially important the case in building skills and attitudes toward financial independence. Early entrepreneurial exposure refers to the accumulated experiences in an individual’s history that contribute to their entrepreneurial process. In those processes, one is likely to gain lessons that lead to having an attitude of hard work and independence, as well as making positive financial decisions.

The following are some ways through which people are exposed to entrepreneurship, and why it links to financial independence:

Through observation: They had a parent or mentor who was an entrepreneur (owned and ran a business). Observation is a primary element to social learning; through observation the individual learns about a subject matter and how the outcomes associated with those observations further shape their future attitude. In the case of achieving financial independence, there are attitudes and positive financial behaviour that children develop over time when granted the opportunity to observe specific role models, especially those closest to them (for example, family). Parents play a significant role as they often provide information that determine future actions of their children (especially actions pertaining to money) and can be powerful influencers in a child’s future.

Through experience: They started or tried to set up a business, or engaged in entrepreneurial activities (i.e., washing cars in the community for money, etc.) in the developmental stages of life (7-16 years). Studies on financial independence revealed that children taking up work experiences got encouraged to manage money and also had attitudes of independence instilled in them. Furthermore, the experiential learning theory states that direct experiences are crucial in the learning process. Individuals learn positive behaviours that affect their transition toward financial independence, and it is important that they have experiences that allow them to imbibe those behaviours.

Through education: They were taught about entrepreneurship in primary and secondary school (where people are between the ages of critical identity formation). The environment people find themselves growing in can affect their actions and their personalities. This external ecosystem often involves peers, media and school. Outside the home, most children’s biggest point of contact are the actors within a school. Thus, a learning environment that provides immersive entrepreneurial experiences and studies would leave permanent imprints of independence, hard work, responsibility and money management skill-set (a good recipe for progression toward financial independence) – even if not all the children grow up to be entrepreneurs.

These aspects of entrepreneurial exposure, especially at an early stage of life, can prove critical to one’s journey toward financial independence because lessons or principles of hard work, independence and managing money are deployed. In learning more about this pathway toward financial independence for the Ghanaian youth, there were many more interesting, unexpected insights – one of which was: people who had been educated to the vocational level were more financially independent than those with university-level education, and beyond. Vocational education reinforces skill and trade. The question remains whether there could be markers of entrepreneurship within this education type. If there are, then it is clear we have short-changed children, the younger generation of Ghanaians and Africans at large, and reduced the benefits they could have got if they were encouraged and exposed to entrepreneurial experiences. One could say we have robbed them of a potential pathway to becoming financially independent at a younger age.

However, all hope is not lost. Hopefully, this will be the first of many calls to have conversations around early entrepreneurial exposure through observation at the family level, through deliberate attempts to provide experiences to young ones and through the educational system.

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