Why parents shouldn’t impose their views about money, savings on children


Every generation has unfailingly predicted that the next one is set for doom. Limited by our perspective based on our own history and experiences and unable to live in the world of the young, we disapprove, disagree and dismiss. This war is one that is seldom won.

Those brought up in the scarcity era are a worried pessimistic lot. We know the fear of joblessness; we have lived the era of the government or a PSU being the safest employer; we know many who thought that a pensionable job was a boon. These assumptions have been tested by time. Private sector jobs that rode on the liberalized economy of the 1990s enabled wealth creation and many of us have just begun to be confident spenders.

But we are still unable to appreciate the fleeting attention span of the millennials. The young today are like equity investors. They can move from job to job based on the potential they see. They don’t care for the assured return debt investments of the past. Many of them are small entrepreneurs in their own right. They don’t see earning money as a daunting task. They only see opportunity around them and are confident about finding their way. Fixed income investment is boring for them. I recall an investor in Surat asking me, 9% return? per annum? and laughing loudly. That was in the 1990s in a city that traded equity with liquid cash. The young are such shrewd opportunists today.

I remember how the husband and I were extremely guarded about the pensions our parents drew. While they were proud of the small sums coming into their bank accounts every year, we knew it was hardly adequate to meet their needs. We took care of them, without question, like so many others of our generation did. We have many friends who draw a bigger pension than what they earned while working. They are smug as they live in their own houses and practice frugality. One large expense, they are flustered.

The curtain has been firmly drawn on these privileges—of pension and family care of the elderly. Many of the current generation understand this and are busy building a corpus for retirement. But they also scoff at the young that want to retire at 45 at the most. They think the inheritance they leave behind for the children should help. Little do they know that their children begin with an earning higher than what their parents retired with. Every generation figures its wealth creation strategy without the overt pessimism and judgment of the previous generation.

My Swiggy delivery boy told me that he was taking his girlfriend out to lunch. I won’t take deliveries for the next two hours, he told me. I was impressed. I belong to the generation where the husband will pick up a call at work only if the phone rang persistently for the second time. That was a signal that it was urgent. I had to be discreet about using that privilege, so that it remained working. The young truly believe we worked too hard and too much and failed to enjoy life. I tend to agree.

But we disapprove of their spending habits. To their utter annoyance. We think the young are out to destroy themselves by spending their incomes. We remind them of a rainy day. We are burdened by the storms that tore our childhoods and working lives apart. But the young haven’t seen a storm to know what this rainy day is about. They have only seen prosperity. They save, but not overtly so. They work, but don’t burn themselves in the process. We dismiss them as being careless for we do not know.

The earlier generations made a virtue of assets. Assets marked the wealth of a household. We accumulated and hoarded and we are proud of our networth. The young tend to expense most of their spends. They are happy to rent than buy; hire than own; replace than repair; move than stay. They fit these spends into their incomes and focus on increasing their income earning capability to be able to afford their spends. They see hoarded assets as wasteful.

We don’t understand because we don’t know how to spend. We have been savers all our lives and know nothing better. As we stare at our stash at 60, a disgruntled spouse and ratting limbs tell us the sad stories of the many missed holidays and old age. We saved for later, and that later came too late. But we don’t accept defeat. We grudge the young for their indulgences.

The scarcity mentality is our burden. We see the world as a limited pie. One in which one can gain only if the other loses. We therefore remain suspicious, needlessly cut throat, and envious. The young are blessed with a generous mentality. They see the endless possibilities for growth, and know one or the other opportunity will come their way. They are more empathetic, kind and gentler in their approach. We could learn if we cared to watch what a secure and indulgent upbringing can foster.

We don’t stop making decisions for the young. Or offering them unsolicited advice. We impose on them our world view. You must study to acquire a masters degree, we tell them. Education is everything, we swear. They see the futility of formal education and the immense scope to learn by experience and observation. They fail to see how an individualized testing system can prepare one for a world in which collaborative problem solving is the norm. We don’t admit easily that we failed them in many ways.

We want to leave behind a fortune for them. For we love them. That house in the suburbs, those antique jewellery in the locker; those deposits in the bank and post office; and all our ultra conservative investments are theirs. But alas, we are cursed to live so long, as life expectancy has moved up. By the time we pass and they inherit it all, they would be in their 60s. Of what use is the inheritance if they can’t use it when they need it? We don’t appreciate that conversation.

Let’s pause to consider the reality that we aren’t players in the same game. We are simply sitting at the gallery and cheering. We don’t understand the rules, strategies and nuances of their game. We don’t have that ability. Not even in our dreams. Bringing them up with the ethics and values we stood for was the true inheritance. That has been passed on already, implicitly and explicitly. We must let them go.

(The author is chairperson, Centre for Investment Education and Learning)

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