In a modern household, both the parents are usually working so they can support the rising demands of the 21st century lifestyle. We have arrived at a concept of weekends and extended holidays to spend time with our loved ones. So, when an 8-year-old asks his father for an expensive toy on his weekly trip to the mall, what do you think the father does?
If you are a parent, consider yourself in this situation – What would you do? Here are your options to consider
A) You would oblige by getting your kid what he/she wants since you don’t want him/her to think that you are not so fun to hang out with.
B) You would tell your kid that it’s an expensive item and you wouldn’t buy it thereby spoiling the child’s mood or
C) You try to teach him about the difference between NEED vs WANTS and how he/she can be prudent about the demands they make.
As parents we want to choose option C but we end up choosing option A.
Mrs Sunita Pant, Principal at a reputed school in Mumbai tells us that Parents now-a-days are compensating for the lost time with expensive gifts and luxuries.
Kids of today’s generation are far more well informed, they interact with a wide variety of media and make many decisions themselves. Downloading a new game that costs 99 Rs on PlayStore is such an easy task now with plastic money. Choosing to eat at the café even when the carry a lunch box from home. Getting the new Avengers backpack just because its popular among their friends. These are financial decisions that kids make on a daily basis.
On an average a child gets 12000 to 15000 Rs in a year in the form of his/her disposable income
Be it birthday money, Diwali money, elders visiting, cash prize from some competition, etc. This is over and above the pocket money and other regular expenses that the child is making. Have you ever wondered what he/she is doing with this money? More often than not the kid will end up spending it on his/her favorite clothes, games or pizza!
With no understanding of how to handle money, when these kids will enter their professional fields, the amount of disposable income would be multifold of what they have right now. Brands are on the look-out for such vulnerable new blood where they can start pushing their products. They end up spending their money on new clothes, travelling, movies and gadgets! By the time they start realizing the importance of savings and growing your money they have completed almost 30 years of their life!
The pertinent question here is, what can we do to avoid such failures to our next generation? As parents we want the best for them! How can we imbibe good financial acumen?
The answer to these questions is: If we start exposing our children to various financial aspects right from their childhood it will help them lead a fuller life. Like any other social and moral development of the child, financial development also should begin at a young age. It is important for the child to learn and experience from different situations at various stages of his life.
This is irrespective of which profession the child wants to go to. Be it a Doctor, an actor, a philanthropist or a news reader, sound financial acumen will create a strong foundation for a brighter future.
How can parents improve Financial Literacy in their children?
New age programs like JUNIOR FINANCE WIZ are helping parents and schools introduce financial literacy for their kids. It is based on the guidelines by the Reserve Bank of India.
Parents and Schools can enrol their kids in India’s First National Finance Olympiad and give them a chance to win big prizes while learning about good money practices Visit: www.financefundas.in for more information
The right step towards a brighter future of your child is to equip them with sound financial acumen!
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