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Press Offices > Short Term Insurers

Hollard Insurance
Press Office Feature : Mothers have the vaccine for the ‘gimme-that-now’ epidemic

Company: Hollard Insurance
Author:Susan Ford
Email:[email protected]
Posted:13 May 2007

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What kind of adult am I trying to help my child to be when they are big?

Mothers have the vaccine to inoculate the next generation against the gimme-that-now epidemic that has South Africans in its debt grip and all it takes is a financial type of potty training at an early age in the arena psychologists call ‘delayed gratification’.

Today’s adults who have not learned this delaying lesson have credit at their disposal to feed their gimme-that-now addiction which removes personal wealth building opportunities, says Zuriel Naiker (Pictured right), Hollard’s assistant Communications Manager in charge of consumer education through media.

“Because Hollard is in the business of asset protection and wealth development, we have been investigating practical ways of making an impact on our country’s debt overload. Child development experts say that if children are taught from an early age to save a percentage of their personal money for bigger goals, it would plant the right seeds.  So we are appealing to mothers at this time to teach money management skills to their children and are sharing some expert guidelines we have learned.

“I was one of the lucky ones with a smart Mom who used the one for one rule:  From a very early age she gave me and my four siblings pocket money and used the one for one rule. We had to save 50% of the cost of something special we wanted and she provided the rest.  It was an empowering lesson that remains with us today.”

Adel Kriel, one of Hollard’s mothers in management has the message loud and clear.  “Mothers know all about teaching children about ‘delayed gratification’ except we call it by other names like ‘potty training’ and the ‘no sweets before dinner’ rule.  But few extend those control lessons into the financial arena through birthday, tuck shop and pocket money management.  A friend of mine runs a tuck shop and a 7-year-old presented a R100 note to buy sweets the other day!     

“I am convinced mothers play a vital role in making sure their children grow up to be smart and confident adults when they handle budgets and money in the real world.  Working in the financial services industry exposes me to adults who have not had this financial skills training early in life and their efforts to build personal wealth are sabotaged by their debt.”

Kriel points out that the income of children has become complex.  “At the age of 7 my eldest has a startling four sources of income:  pocket money, tuck shop money, birthday gifts and the cash he earns from his own efforts at school entrepreneurial days." 

"His natural instinct was to rush out and spend every cent immediately, but through a bit of gentle persuasion he has learned to save at least a percentage in his piggy bank for bigger, long term, goals. When he reaches a goal there is a sense of personal achievement that builds confidence.

“Even a simple thing like keeping some sweets for future consumption teaches the lesson of delayed gratification that experts say we need to teach our children.”  

And control is also needed on her side.  “My natural instinct as a mother is to give him everything he wants when he wants it, like when we are out shopping. But even when I have the spare cash I hold back and make him earn something special, wait for a birthday or plan to pay for it out of his own money.”

What counsellors advise

Liz Dooley, Director at the Family Life Centre in Johannesburg, says the key question a parent needs to ask themselves is: “What kind of adult am I trying to help my child to be when they are big?” 

She says most parents she speaks to on this topic will include the word “independent” in that description.  “However, too many parents smother independence by not allowing their children to make their own choices. Children need areas of their lives over which they feel they have total control." 

"Being over protective, for instance, or showering them with endless supplies of spending money, does not teach children how to make choices for themselves and then become responsible for those choices,” she says.

According to Dooley, personal money is a training tool:

  • Give them pocket money over which they have total control and have the rule that when it’s gone it’s gone.  “If they spend it all on the first day it is vital that they be allowed to learn the lesson that they need to budget better next time.” 
  • The amount of pocket money a child is given needs to be appropriate to their age.  “In teenage years, for instance, the monthly pocket money may even include a personal clothing allowance, an entertainment budget and cell phone airtime if they have a phone. But they must manage on that money.” 
  • Show them how the household budget works.  Some find it useful to use physical notes to make piles of money for rent, food, clothes and other monthly commitments.

What is inappropriate?

An extreme example is giving a Grade 1 child R100 for tuck shop money but there are many examples.  Kriel says “Another recent mothering challenge I had to face was the case of the R3000 robot my 7-year-old wants. I explained, as I am sure most mothers would, that it was too expensive." 

"But I used the opportunity to point out that when he was grown up he could save for these kinds of expensive things for himself. Or, that if he could save up the money from his pocket money he could buy it from his own money. At this stage he has no concept of what R3000 looks like but if he tries to save for it he will learn that valuable lesson.

“Mothers have an awesome power to teach money management skills. Let’s raise children who will be financially stable adults!”

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