Making kids penny-wise. Their Story: Checking bills in shops and hotels

Eight-year-old Lakshana Chellam of Hyderabad may not have her own piggy bank to save money as she gives it all to her parents. But she is a conscious shopper. “When deciding what side-dish to buy at the hotel, I see the price. I like bendi and peas but if the price of the sabji is ₹109 and not ₹98, I don’t want to buy it,” she says. She would rather wait to eat it on a different day at a lower price. She is also particular about not wasting food.

“When I was younger, I would invariably leave some food uneaten in my lunch box. But now that I am in the fourth standard, I know that food is a gift and one must not waste it,” she avers.

What brought about the change? “My grandparents and parents have taught me not to throw away things. Even in school, I take only the required amount of paper, pencil and other stationery, never in excess,” she says with pride.

Her parents let her handle money in small ways. For instance, when they go shopping in a vegetable market, she is asked to give the cash and get the change. At a restaurant, she verifies the bill to check if the food items consumed are listed correctly and if the price is right.

Curbing impulse purchases

Mahalakshmi DM, who runs a consulting firm in Mumbai, is teaching her son the essential money mantras. Fourteen-year-old Mikhel Mathews knows concepts such as interest, investment and risk.

His pocket money is split between expenditure and mandatory savings.

The family, especially Mikhel’s father Mathews, has imbibed three important budgeting rules. “Expenditure is curbed to 50-70 per cent of income. Spending, on aspirational purchases, such as a PS4, is postponed. And whatever is left is saved in a bank account immediately to avoid impulse spends,” Mahalakshmi details. 

 Is it working? “I have observed that grandparents insist on public transport to save money and are very conscious about savings. I realise it is a good idea to spend only necessary amounts, curb impulse purchases and buy the right thing at the right price,” says Mikhel.

Mikhel thinks the fact that money multiplies over time or doubles through proper savings and investments is “cool.”

“I will always nurture the ambition of owning a Lamborghini. Hopefully, by the time I am my parents’ age I shall own that car,” he says.

 But Mahalakshmi wants to teach him more. “I wish I could give him the opportunity to earn money for chores done and get empowered with small earnings, like chidren in the western world,” she says.

She feels this would help him understand how hard it is to earn money and become more financially aware. But the Indian family indulgence when it comes to a single child gets in the way.

Saving starts with pocket money

Manoj Arora of Mumbai, who owns a garment manufacturing business, confides that his only son, born after 11 years of marriage, is quite pampered. But he thinks it is important to teach him the value of money. “Kids think ₹400 is ‘just’ 400. I stop my son when he says such things and tell him that many families don’t earn that much money in a week,” he says.

His son, who is now 17, gets pocket money of ₹1,000 per month.

Besides this, he is given money for other expenses too, such as conveyance costs towards tuition, birthday gifts for friends and other things he wants.

“This way, he has managed to save his pocket money and plans to use it for a larger purchase later,” he says.

Arora feels that things have changed a lot in the last few decades and it is therefore important to teach children financial values.

He gives the example of his friend, a doctor, whose son did not want his father travelling by a scooter.

“Kids compare notes on what phones and cars their parents have now,” he rues.

“When I was in school, we used to have students from various backgrounds in the same class. Some were very rich, many were middle-class and there were also students from poor families.

But now, the rich and poor are segregated. The well-to-do send their children to IB schools, the upper middle-class parents opt for ICSE schools and so on,” he says.

As a result of being confined to their social strata, children don’t get a broad view of money values, he feels.

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