Money Lessons x Parenting Woes (Part 1)

I often reflect on how to parent our children especially concerning purpose in life and financial literacy as well as financial intelligence (there is a difference!). Our children are going to grow up in a household that, as far as we can foresee, will be sufficient and they will not know hardship. I don’t think we are going to get away easily by saying “Oh we can’t afford that” when they are us for what most kids would ask, say a video game or phone or laptop. We are going to have to teach them some money values!

It is tricky. I look back at how Mr.C and I were brought up and the money principles we inherited. Mr.C’s parents were hard-workers and extreme savers. The toys that he had as a kid were mostly free gifts that came from purchasing necessities such as toothpaste or milk. Their money principles were well absorbed by Mr.C who started working during the semester breaks and saved. He was never a spender and always thought about money and businesses and still does 😉

My parents, on the other hand, were getting their first taste of having a comfortable amount of cash, both working and we lived very comfortably although we certainly were not rich. We got almost everything we wanted as kids. I don’t remember any talk about financial literacy and how to deal with money. When I first had a sizeable monthly allowance during my tertiary education, I lacked any skill in terms of managing it.

Our financial prowess was as different as day and night. When we started going out, I was easy with money and spending without much thought. I don’t believe I even saved all that much or any even although I must say that I was never in debt. I always paid my bills! Mr.C had a tidy savings and an Excel spreadsheet tracking his expenditures. Like a deer in the headlights, we were both astound at each others’ approach.

Along the way, we have reached a unique recipe for financial approach that we blended created from our experiences, our beliefs and our desires for the the present and future. It’s stewing away continuously and it smells absolutely delish! There are many lessons I personally take away from this however the most important lesson is that financial conversations must start at home!

I realize how precarious my situation was before meeting Mr.C, getting caught in a reality that was what I saw but did not understand. I was to work my way till retirement at a ripe old age. Take a loan for the car, take a loan to buy a house and use my salary to repay loans before having fun with whatever that was left and to save a little.

So when I think about talking to my kids, the big questions that I want to cover with them are:

1. How much to save?
2. What do you do with the savings?
3. How do you tame the lifestyle inflation lion / lioness?
4. Do you really need everything that you fancy?
5. How to be at peace with less?

As I was writing this, I decided to do a little market research within my varied group of friends. I set out asking the following questions which led to further discussions and questions.

1. Did you have any financial education kind of conversations at home, and if so at what age?
2. At what age were you conscious of the importance of savings & differentiating between needs & wants?
3. What are your top financial lessons that you wish you had earlier on in life?
4. What are your thoughts about investing and do you wish you learnt it earlier?

It was such an interesting topic for me to explore with my friends, some in groups and some individually. My findings:

• 3/4 did not have financial education conversations at home
• 1/4 had financial aspirations built out of “I can’t afford it” responses from parents
• Most were conscious about savings only when they started working or after a major life event

Some standalone responses that struck me as very interesting:

• The most ideal answer came from an American friend of mine who learnt about savings, living within your means and compound interest by receiving bonds as gifts which paid for some of her university fees
• Regarding advice to give children, there was a mention of buying insurance (either term or life) as soon as they started working. This is a passion topic for Mr.C, perhaps we will see a post on this soon. (Nudge, nudge)

Stay tuned for Part 2 as I explore the Big Questions! While waiting, chime in on what you consider your biggest money lessons and if you have a robust conversation at home, either verbally or by observing. Explore the topic with your partner even!