This post is another look at why we avoid personal finance. And what we can do to teach our children the value of money.
Why we sweep finance under the carpet
I often wonder why we were not taught the basic things about money when we were younger. And I know that every parent means well for their child (I’m a parent for 15 years now!).
People say that we need to have a personal finance education at school. Okay this may be a good idea, but I have a question.
We are aware of our future goals like what will we do when we grow up. Bade hokar kya banoge?, is such a cliched question, we are bound to answer them.(I’ve been an exception, and still have not decided! 
) Or aware of social values like respecting elders. No formal education teaches the above two. Then, why this lack of awareness about money?
Moreover making kids aware of money issues is not really a rocket science. It’s a lot easier than what’s covered in Class IX-X these days.
More important than the knowledge is the skills & attitude towards money, I feel. Atleast, when the kids are in school. So the best person to teach the kid about money is not the school, but the parent.
But instead of instilling money values in our kids, we buy them toys even when we can’t really afford them. Dad is my ATM, they say. And Dad is happy too.
But when they grow up and have money on their own, they don’t really value the money. They are not aware of simple principles like the magic of compounding or rupee cost averaging.
Late in the day, some people (like me) wake up and decide to learn. But there are hordes of people around me who are hardwired to avoid making financial decisions. They depend on ill informed financial advisors who make a good living out of this lack of awareness.
Trying to inculcate money values in my child
I read something like this,(source unknown) “The best way to teach a kid about the value of money is to show him poverty”. Or maybe, experiencing poverty.
As an experiment, I put all my income from the day job to a few investments through SIP (Systematic Investment Plan). So for six months my salary went off to the SIP. Ofcourse, I had the backups and the monthly income from my websites to fall back upon.
I shared this information with my family. And I am happy to see the results. Not only the portfolio has increased significantly, my son thinks twice before asking to eat out, scheduling/reducing his pizza/noodles cravings, etc.
Most importantly, he now knows that money has value. I have thought of discussing the magic of compounding or the rupee cost averaging with him. But as of now, I have not found the courage!
“What Dad, keep it for your blog”, I’m afraid he will say!
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That’s an uber cool description of how we think and how should we! Wish you wrote this a couple of years back.
Never mind, better late that never! I still have time to be a dad! Or to be a husband for that matter
Thanks Praval. It’s never too late. Not even for a 42 year old guy like me! I’ve got another 40 odd years to rectify my past mistakes!
True!