In his weekly newsletter Education and Catastrophe, our founder John Tan shared 4 recommendations on raising successful children.
- Value your child’s hobbies
- Allow them to make choices
- Don’t prize Money or Academic Qualifications over Happiness
- Financial Literacy is Essential
Financial Literacy is an important life skill for kids. However, you might wonder, how can I approach financial literacy in a way that would not lead my child to be overly conscious of monetary value? These tips highlighted a very important gap missing in the majority of financial literacy resources out there.
1. Financial Literacy isn’t just about consumption.
Much of the resources we’ve seen simplify money to one sole, singular purpose.
“Money can buy things. You can earn money by working. You should use money to buy your needs, before you buy your wants.”
Along the way, some math gets thrown in, the concept of supply and demand might pop in and say hi 👋🏻 for a bit, but that’s pretty much the gist.
2. Money is not our Purpose in Life
Money is a physical representation of value, but children should also be taught that we should value many other things besides it.
👉🏻Relationships
👉🏻Time
👉🏻Personal Well-being
👉🏻Fulfilment
If you think about it, when you spend time working to earn money - that’s time you could have spent nurturing relationships, improving your well-being or pursuing a passion.
Children intrinsically know this; and they instinctively value family and community above personal benefit. This was demonstrated in UP TV’s experiment in 2015, where the kids were given the choice between their dream gift, or a gift for their parents.
(Credit: The Washington Post)
3. The Wrong Mindset about Money can be Destructive
“Spending time on this is a waste of time, it won’t earn you money.”
“I’m only successful if I can buy these luxuries”
“There’s no need to spend time making it, you can just buy it with money”
Notice something in common? These perspectives use money as the sole determinant to identify what is worth your time and effort.
In truth, we know that relationships are worth the effort.
We know that eating well, exercising well and treating your body right, is worth the effort.
We also know that pursuing things that bring you joy, is worth the effort.
So why are we still teaching children to value life in terms of money?
4. Teach Financial Literacy as a Means to Live a Life of Purpose
Let’s talk about the first principles of Financial Literacy.
- Money is a limited resource.
- Money can be traded for other resources.
When we distil money down to these two key principles, it becomes clearer how we should think about money and allocate our time and effort to it. Just like time, money is just another resource. It all boils down to how you decide to use it.
Allow your child the time, space and opportunity to explore what is important to them. Refrain from belittling their decisions or evaluating them in purely monetary terms.
In doing so, they become free from the burden of feeling guilt over spending time on other things that matter. Money no longer frames their worldview. Purpose does; and in finding purpose and taking action to satisfy it, that is when we begin to live a meaningful life.
“When you are purposeful and take daily action, more opportunities come into your life. Believe and build more.” ― Wesam Fawzi
This post was inspired by our Sharpening Minds community, where some parents highlighted their concerns that they felt guilt and anxiety over the financial freedom their children enjoyed. They expressed their worries about how they could ensure that their children would not grow up to be idle, without purpose, frittering their time away on an endless cycle of consumption, without consequences or positive impact.
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