Venmo. Apple Pay. Zelle.
Many children today do not experience physical money; instead, they use digital transactions through their phones.
That shift away from cash is changing how children understand money, and financial experts say Black families have the most to lose if an old-fashioned lesson gets left behind.
Cash use among Generation Z has fallen to about 7%, a historic low, while digital wallets and cards make up roughly 92% of preferred payment methods among 18- to 29-year-olds, according to a study by digital payments company Billtrust.
Sharita M. Humphrey, a Houston-based certified financial education instructor, said the disconnect starts small, with a tap instead of a transaction.
“When you have the card, or your debit card or credit card … you’re like, ‘Oh, I can just tap. Everything’s a tap,'” Humphrey said. “We’re not really thinking about it.”
Humphrey said breaking a $20 bill forces a kind of awareness that swiping does not. Handing over cash and watching the change come back creates a pause, a moment to register that money was actually spent. Digital payments remove that pause, and with it, the memory of where the money went.
“If you ask them if they had a $20, $50, $100 bill, they can tell you, I went here, here, here,” Humphrey said. “But you can’t do that after a string of taps.”
That erasure compounds a problem that starts at home. Parents stretched thin by their own bills often do not have the bandwidth for money conversations with their kids, and children absorb financial stress and habits, good or bad, whether or not adults talk about them directly.
“Wealth is generational, but so is the lack thereof.”
Sharita M. Humphrey, certified financial education instructor
“Wealth is generational, but so is the lack thereof,” Humphrey said. “Debt can be generational.”
Without knowing someone else’s tax bracket, credit score, or debt load, people measure their own finances against a curated version of someone else’s life. Humphrey added that sometimes taking on unnecessary debt, or “lifestyle creep,” just to keep pace.
Reshell Smith, a certified financial planner who spent 16 years at Charles Schwab before founding AMES Financial Solutions, said the racial wealth gap itself is systemic, rooted in barriers to homeownership and access to capital. But she said the loss of everyday money lessons adds a second, quieter layer of harm.
When a parent sends a child a Cash App payment to cover shoes or a school fee, there is no decision-making involved.
“There’s no thought in that,” Smith said. “The only decision that he’s making is, let me call my mom, see if she can Cash App me.”
Smith said the fix is not to reject technology, but to pair it with intentional conversations that go beyond budgeting, including lessons on investing, credit, and ownership, since most families build wealth through retirement accounts and home equity.
She also pointed to a growing number of states requiring personal finance education. Texas became the 29th state to mandate a personal finance course for high school graduation when Gov. Greg Abbott signed House Bill 27 in June, effective for incoming ninth graders in 2026-27. Roughly 30 states now guarantee a standalone personal finance course before graduation, up from eight in 2020, according to Next Gen Personal Finance.
Cash is not obsolete. Smith encourages families to hold regular “money talks” so financial habits do not stay invisible. Splitting a child’s allowance between cash and a kids’ debit card so they can practice managing both.
“Cash is still king,” Smith said. “It’s OK to have it. It’s OK to manage it. But don’t let it be out of sight and out of mind.”
