Raising Financially Savvy Children – 5 Peaks and Pitfalls
Much has been said lately, and there is an emerging buzz about the need to deviate from the age old advice to go to school, work hard, get a white collar job and be successful. The need to develop an entrepreneurship streak in our children and have them grow with a financial astuteness is becoming more and more critical. Here’s how we’re going to change this mindset and get down to business……..
Pocket friendly finances!
I have a client with three children. Each birthday she increases their pocket money by 100 shillings. So the 7 year old gets 700 shillings a month for example. They get it like a salary, no questions asked. The children use the money buy their own toys and luxury clothing items. Their mother buys their basic clothing at Toi market – the flea market off Jamhuri Rd. Consequently the children store and look after their toys very well. They all learn about responsibility, delayed gratification, making financial decisions and looking towards choices that are longer term. By deciding the item they want, examining the quality and eventually buying it on their own after months of saving.
No money no problems!
Another client never received pocket money as a child, and never had money of his own. He grew up cautious about spending money, and at 12 years of age he was selling CDs in school to make some cash and by 16 he had his first job as a clerk in a bank. On the other hand as an adult by his own admission he overcompensated by buying and hoarding all the DVDs, books and items he was not able to buy as a child: he still struggles with this, and a love for all things classy and expensive.
Another, an Asian, grew up going to his fathers’ mechanic shop and helping out after school. At 18 he decided to take it over and eventually build it into a million shilling business. His wife, a sharp contrast, also from an entrepreneurial family went to prestigious schools in London to study for a Degree and a Masters business but didn’t end up with practical entrepreneurial skills at all.
A friend grew up writing a list of what she needed every time she wanted money from her father. She would plan her financial requests for each quarter and approach him for the adult conversation about her needs. He would sit her down canceling list items and lecturing her about how he had bills to pay, and how school fees was overwhelming, that money didn’t grow on trees, that he worked so hard everyday for every penny etc. She grew up apologetic about asking for money and has until recently never asked for a pay rise at work, even when she deserved it.
Your own common sense!
There’s a broad spectrum of places to sit on the scale; Identify and eliminate your own money prejudices, then use your judgment and listen to your instincts to moderate your choices. What matters most is that both parents decide together how their children will be raised and stick with it. As long as there is love and unity of purpose I believe your child will be ok.
What’s your story? How are you raising your children to become financially independent?
Lina is a media practitioner, communications strategist and entrepreneur who helps start-ups define their business strategy and get started. She also consults for veteran entrepreneurs. She interviews leaders and shares inspiring stories about entrepreneurship and life on www.linaconnect.com