America Gives Newborns $1,000. Europe Gives Them a Pension Bill.

As a father of three small kids in Europe, this one caught my attention.

This summer, the US began putting $1,000 into an investment account for every newborn baby. Six million opened in the first weekend, 86% of them to households earning under $200,000. Main Street, not Wall Street. Basically, everyone gets to benefit from the upside of the capital markets.

In Europe, our kids instead inherit a share of a spiralling pension debt. Retirement spending already eats 12.3% of EU GDP, more than 14% in France and Italy, and in Spain it has climbed among the fastest in the OECD since 2000.

I keep wondering what that does to Europe's next generation (incl. my own children).

A US newborn baby gets €1,000 at birth and with just €50 contribution a month, at long-run market returns, they each have roughly €38,000 by 18 and €125,000 by 30. It's just arithmetic and time. Left untouched to retirement, it could reach above €1M. Not bad.

The EU's own survey found only 18% of Europeans have a high level of financial literacy, and more than half doubt they'll have enough to retire on. In addition to the pension bill, are we also passing financial ignorance down to the next generation?

I don't have the policy answer but I've come to think it starts small, with visibility: a parent who is empowered and can actually see and understand their whole financial picture, will be able to pass that clarity on to his/her children.

That's the idea behind Senso. Democratizing financial intelligence. Financial empowerment for ordinary Europeans.