Kids : can we raise them to be financially aware?

For what it is worth, I better start by saying that I don’t have kids, yet.

(This “yet” was for my parents. So is the cover photo I have used.)

I have met some very interesting parents who have some very interesting ideas around how to raise financially aware kids. Plus, I have some thoughts of my own. So here we are.

I don’t know how many of you have this feeling, but I cherish my childhood.

I had the best childhood with two siblings, big house in a small city with all the open space and under construction spaces for us to play and go wild, best school, an absolutely indulging mom and a father who pampered us crazy.

We got a good share of beating too, my brother more than us sisters, but that’s in the past! And then my friends were super amazing, so that added to the charm.

What happened to us?

Coming back to pampering, our generation was pampered for a reason. I can speak for my family at least.

Both my parents do not come from a well off family.

Even if families were well off, I doubt the kids in that era ever got any disposable money from their parents anyway.

My grandfather was a lawyer but my father had a business mind and left home at a young age of 17 for work. My maternal grandfather had it tougher.

You only need one night with my uncles to figure out the state of affairs back in the day! They love telling us how they used to share one trouser among five brothers. Only one person could step out of the house at a time!

Our parents never had it easy. They had to work to earn their bread.

Most of our parents have lived in one room set. My father was a family of eight living in a 300 sq ft room. May be even smaller. My mother, family of eight again.

For them, to earn and give their first salaries to mothers and providing for their family brought a sense of contentment, pride and sometimes even achievement.

And then WE grew up. In a big house that our parents bought/rented because they did not want their kids to live the way they lived.

Educated in the best school because our parents wanted to make sure we get education and then a job.

New books and bags and dresses because they knew how that affects a child’s psychologically, they have been through that.

With extracurriculars — dance, music, swimming etc because they wanted to give us the best childhood, the one they wished they had.

And because respecting money came naturally to our parents, they assumed we will learn it too. In due time. (Also may be because our parents relate money to stress, owing to their childhood, they kept us shielded from any money talk for a major part of our childhood)

And the schools, for some reason I can never understand, stayed away from money and sex education completely. The two areas our generation ended up exploring, figuring out and then finally settling.

In the process, some picked up early and sailed through. Some suffered and some continue to suffer.

So you see, till we were pampered, all was good.

When left to our own devices, we first fell flat and then got up and are still finding our ground.

What about our kids?

So what do we learn from this? Do we realize that the pressure on us is double fold?

We would want to give our kids, whenever (and IF) we have them, the childhood as amazing as ours, may be better. Plus make sure they learn about money and sex. Because you see, that’s a cycle. We don’t want them to suffer the way we have.

It is just us in our parent’s place isn’t it?

That, and interaction with some interesting parents, got me thinking. What do we do?

Rethink Pocket Money

I get to meet some very smart people on the job. This gyaan comes from some people I have met.

To teach their kids about saving, investing, budgeting etc, these people actually either credit child’s monthly pocket money in a bank account or invest via SIP in a mutual fund.

I have seen both the cases.

Think of what that does to a child’s mind.

They learn to put away money as it comes instead of scheming on how to spend it (like yours truly). They develop a sense of ownership and understand money as an asset. They see it grow.

They can actually have a discussion with you before spending and you can make sure they weigh the cost benefit before withdrawing.

But beware, you have to treat it as their money. Don’t assume control and don’t forget that spending money is also a critical part of understanding money management. Let them spend, but make sure they understand what they are doing.

Brace yourself for all the negotiations that come your way. I am told, kids are the world’s best negotiators.

Build their skill

If you see a skill in your child, please support it. Singing, dancing, theatre, poetry, art, swimming, sports, games, computers, music, whatever.

I have realised a skill stay with you forever. Education is important and gets you stability, gives you foundation. But a skill gives you wings.

It sometimes see you through the worst of times. It lets you build a source of alternate income when the time is right.

Many a times, eventually you end up building your life on a skill you have and using your education as a tool. The role reversal is probable.

A skill is not a distraction in long term. In short term yes, you will have to discipline the child. But don’t curb it, don’t kill it. Build it for the sake of your child.

Teach them to earn

I have realised there is so much discontentment in jobs because people either feel underpaid, undervalued or feel like a slave.

That’s because since childhood, we have always felt entitled. Entitled to throw a tantrum and get what we want. We never learned to earn.

The first time we have to do it, and for the rest of our lives too, is for some stranger.

When your parents work on salaries, it is relatively easier because you see them doing 9 to 5 as a child and you understand, ‘okay, this is what adults do.’ Work to earn money.

I am a product of business minded parents, both of them. As a child, I never saw them as working for money. Or doing a 9 to 5.

My father at that time was an electrical contractor and my mother had opened a parlour, health club and boutique at home. They both employed people who did manual labor.

I always saw them out and about, either traveling or meeting people and making money to pay their employees.

Off course, they were working hard and getting paid in the process but the child in me saw parents who were providing employment, always.

And so being employed is not easy for me. It is nice, but it is not easy.

Whatever the kid decides to do (job, business, freelance) she has to learn that there are no free lunches. It will be amazing if the child grow up and crack a fortune, but why to leave it on luck?

Better teach them at home. You love your child, you can teach them without hurting them in any way.

Every now and then, indulge them in a game. Pay them virtual money/points to do dishes, to make bed, to put clothes in machine. These are jobs. They will grow up and pay people to do it for them. They got to value labour.

When they value labor, they will value themselves too.

Redeem these points for a wish. They will do more than you want them to. Let them demand more, they will learn asking for a raise.

As they grow up, help them build a kiddy business. Show them how they can earn by creating something, by delegating, by selling.

No better way to teach them what a good 40–50 years of life is like, isn’t it?

Be vulnerable

Parents want to be the best. They are protective and they are providers. But let me say it straight out — that’s a job, not an obligation. Your job as parents is to provide for the little being, you are not obligated to fulfil all their wishes.

My mother started sharing vulnerabilities with us when we were quite young. What they could afford to buy, and what they couldn’t. The difficulty with which our father was ensuring we get the best education.

When my father was stretching beyond his means to buy us something, we knew it. She made sure we were not entitled kids.

Vulnerability, I have realised, brings a much required dose of reality to all the pampering.

But wait till you have kids

I know. The motherly feeling may overpower. I don’t deny that.

But emotions are not always beneficial or correct. What I write today is a truth coming out from wisdom of parents, my understanding of life and my own limitations as I see it.

I just know this, the roots were strong and the tree stood its ground. We had it better than our parents for sure. We only have to make sure the next generation feels the same.

And there is no better place to learn than a home and no better teacher than a parent.

And you have just 18 years to prepare them for next 50 at least!

I am interested in knowing if parents agree or disagree with me.

All game for parental wisdom.

And hacks! Let me know!

Originally published at She Talk Cents.

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