Teaching your children how to manage finances in school

WORRYING: Children usually devise new schemes to defraud their parents.
WORRYING: Children usually devise new schemes to defraud their parents.

Kenyans are always baying for the blood of public officials who squander taxpayers’ money. But, unwittingly, we risk creating new spendthrift generations every time we take our children to form one by giving them more money than they need. Tragedy is that some new parents often box themselves into a corner by setting their children’s conspicuous consumption for the next four years and at the expense of urgent needs.

There have been extreme cases in school where some up market parents give their children as much as Sh13,000 per term, which is a thousand every week, for their “personal use!” This translates to Sh39,000 per year and Sh159,000 over the entire four-year course. This money could buy a modest stake in the stock market doubling or tripling in four years and giving you a fabulous return.

But often such children end up in disciplinary issues in school. They may try out drugs and alcohol and playing truant. Often, they pay other less privileged students to do their washing, homework and assigned duties for them besides running errands for them to obtain contraband. Besides growing up with the wrong notion that money can buy practically anything, including friendship, such pampered children fail to get the all important lesson of financial prudence at a critical and impressionable age.

The question arises of how much money is enough to leave with your child in school. New parents need to ask around from other seasoned parents or teachers on the acceptable cash to entrust a child in a particular school. Of course you should factor in expenses like the bus fare back home on closing day, over-the-counter medication, occasional refreshment when on school outings and emergencies like loss of clothes and so on.

But our youth are not altogether dumb but daily devise new schemes for conspiring to defraud their parents and form ones, even in their inexperience, are not above this.

A common trick is soliciting for funds to pay for upcoming school trips. This is the oldest and most tenacious of all students’ money scams. And the new form ones are likely to learn and practice this antic with ease while their parents’ confidence lasts. So, as a parent verify all trips with the school authorities and, more importantly, the amount required. Often the charges are upped generously to leave the students a little stipend. There would be a problem if your child suddenly becomes outgoing with so many trips in a term. This would be a pointer to a spendthrift lifestyle that could be unsustainable given your resources and overheads of school fees.

A second trick is faking misfortunes. A student desperate for cash will often claim that there has been a theft of all of his or her personal effects. This drives them to borrowing cash heavily from friends and to requesting you the parent to foot the bill. It may all look perfect and sensible, until you examine the nitty gritty. Everything is likely to be overpriced. Demand to be brought all the creditors, in the principal’s office, and you will nip this adventure in the bud.

Thirdly, some students suddenly develop a need for special diet in school as a way of getting extra cash. When this happens, demand to see the note of whoever gave this prescription. Ask why the problem has suddenly arisen. It could be a simple medical issue but exaggerated with a calculated financial aim in mind.

A fourth trick is when students want to do their shopping. Fine, this is a mark of maturity. But many parents are often hoodwinked that things are so expensive nowadays in obscure shops or towns where their children do their shopping. Your child could be making a generous saving and using the extra money for other things.

To stem this culture of lies and careless spending by your child, there are several steps you can take. The first one is to demand a receipt and a full account of your money. You may leave a little margin, but there would be something wrong if your child cannot account for anything upwards of Sh200. Secondly, allow your children to help you with your work or business over the school holidays and pay them for the work. This way, they are likely to understand the value of money and prudence in its spending. Thirdly, let your children know your family overheads. It is not a bad idea to let your secondary school child learn of your house and business premises rents, power and water bills and other overheads. In deed, sending them to pay some of these bills may give them a sense of your net worth and help them measure their demands vis-à-vis this income.

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