Tuesday, April 19, 2011

Spendthrift youth?

I came to know of a story regarding a female private university student who had spent 11k of her parent's money from the start of the semester to now. The semester should be about 4 months, starting from the beginning of the year. It's really incredible because at 11k for 4 months, it's about $2,750 per month of expenses. And she hasn't even started earning her keep yet! This is not the first time I've heard of spendthrift students, but this must be one of the highest maintenance kid that I've heard of.

According to a friend of hers, I came to know that it's because she had taken taxi to and fro everyday. Since she had lived a fair distance from the university, she had to spend around $60 per day on cabs on average. This means that in a span of 4 months, she'll have chalked up 7.2k worth of transportation fees alone. With this amount, it'll be better getting a car rather than taking public transport. I guess the rest of the 3.8k must have been spent on other stuff. It's really amazing to me that a young lady can really spend so much money in 1 month. 2.7k per month can be the typical salary of a worker in Singapore.

This is not the end. There's another story of a student from an elite school in Singapore overhearing that his friend is asking for 3k pocket money from his parents so that he won't have to keep pestering from them again and again. To ask for 3k per month for a student is really something, especially compared to my own pocket money. My pocket money in secondary school per month (estimated, because it had been a really long time) is around $80, rising to around $120 in junior college and finally $200 in university. That sum of money includes everything that I need to buy for that month, like transportation, food/drinks, books, misc fees for school etc. It is all inclusive. It had been roughly 10 to 15 years since I had left school, so had the pocket money rose up by almost 100 times? Had the price of food and entertainment and books rose up by 100 times too? I doubt so.

Perhaps this is the kind of parenthood that a double income household can give to their kids. Instead of giving time to their kids, they had to work and perhaps money is used as a compensation to their kids for that lost time spent together. This is so wrong.

It doesn't really matter if the parents can afford to give these extravagant sum of money to their kids. This is really about sending the wrong signal to their children about money. I wonder how many of these kids will be able to sustain the lifestyle that they must be enjoying right now during their schooling years. Once a high maintenance lifestyle is established, it's going to be very hard to live a more frugal kind of living. What if they can't earn that kind of money to sustain this kind of standard of living? It's just a ticking time bomb for these impressionable youths.

If this is the kind of behaviour that the youths are doing even before they start work, I want no part in this. I hope that they do not wake up one day in a rude shock that they are deeply in debts for their excessive wants. In the end, I also hope that their parents would not be the ultimate ones to suffer because of the actions of their kids. Seems like we're living in a very different world now, so may this be a wake up call for all parents!

*This article is contributed to IM$avvy financial portal, which is managed by Central Provident Fund Board and supported by MoneySense. This site has a noble aim of promoting financial literacy to the general population.


Createwealth8888 said...

Quite common for both working parents to let their kids to have more money to spend. Why both parents work? For more money to spend. Right?

What she is spending may be just a tiny tiny faction of what she will be getting from her Bank of PaPa and Mama.

Derek said...

It may not be entirely the youth fault, parents want the best for their child. If they can afford it, they will. My parents always tell me to concentrate on my studies and if within their means, they will try to provide it.

The same can be said here, just that this youth probably have well to do parents.

Anonymous said...

Different people have different lots in life. For most of us from lower income to working class families, our allowance is probably limited by the pittance take-home pay our parents slogged for. So the most we will see is perhaps 400max by university in our social strata.

For those whose parents individually earns >15k or 100k a month, it is a different story altogether. The parents can afford this kind of allowance and are willing to dote on their precious children. As cw8888 has mentioned, it is probably a minute fraction of her/his inheritance.

Precisely because these are outliers, we find their behaviour outlandish. I think it is something we have to grapple with and become accustom to as the current 1 in 10 millionaires rate may jump to 1 in 5.

PS. From whichever way you see it. $$ becoming smaller through inflation or the pull of wealthy families into our city.


Anonymous said...

Hi LP,
I use to tell my nieces and son if you can afford to buy a Mercedes or BIG MOUTH WOMAN, must you do it? How about a Honda Civic or Accord? Isn't there is always something better to do with your money? Like making it grows?

Let me tell you a real story. My former Boss who is a millionaire many times over, bought her daughter a Volvo when also, she started her NUS study. Why Volvo and not any car? I am thinking of driving one too if I really can afford it.
You see the Really Rich is really very much different from us. To be honest, I may do the same if i am really that rich.
Because: “生 不 带 来, 死 不 带 去。“ But I will still make sure my son understand the value of money and how to use "her" judiciously.
So my former Boss buying a Volvo car for her daughter may be using his money judiciously. No?

la papillion said...

Hi all,

I'm not as concerned about the absolute amount than the value that is imparted to the youths when they are spending these sums of money. Do they think that money is easily available and thus not precious? That would be woeful indeed.

In my work, I've met many students from different spectrum of financial background. I've seen those who are very rich but having a very healthy attitude towards money. When his mum brought him to a very expensive restaurant ordering a steak that borders around 150 to 200 bucks, he cringed because he wonders how good that steak can be. Questioning his parent's spending method is a sign of someone who values money.

I've also seen students from richer background who keeps losing his things. His answer to that is just to buy a new one loh. What values are they imparting?

I'm always mindful that in giving your children the best in life, you might also be spoiling them and ruining their lives. The best thing that you can pass on to your children is not your inheritance, but the right values and the right mindset. With these two treasures, the money can be earned in their own life.

Too many parents, because of their dual income, substitute time for their kids with money. That is truly lamentable.

JW said...


I guess this brings us again to the concept of financial relativity.


Like what was mentioned, it could be a tiny fraction of what the family is earning.

Different people have different views about the same absolute amount. Hence, using absolute amount as a gauge could be something rather subjective.

OT83 said...

Slowly as times goes by..Kid will become the main shareholder of the company. They will have the right to change in balance sheet.

Anonymous said...

I agree with JW about financial relativity. The $200 you got when you were in U is a lot to me, coz I got ZERO allowance and had to take on 2 tuition assignments to support myself throughout my U years. So there.

la papillion said...

Hi JW and anonymous,

I stated again here that it's not the absolute amount of the pocket money that is important. It's the values that is imparted by having access to easy money that matters to me.

Hi OT,

I disagree that they have a right. My children would have to earn their own keep. They shouldn't expect any inheritance from me. If I do give them, it's a gift, and I will make sure they know that too. I need not have to give them any to help them start off in their lives. And they must not think that I will definitely give them any thing. It's my right and not an obligation to pass my wealth to them.

I realised that I'm rather extreme in my views...I apologise in advance if I rocked anybody's view of the world.

financialray said...

Hi all,

Welcome to the real world of widening income gap. So it is no surprise that each see from different side of the glass. If $25000 per month (stats few years ago, please adjust for inflation)is peanuts to some Minister's wife, what is a few thousand dollars a month? It is true perhaps then that family business seldom last more than 3 generations. Let the fittest survive and nature takes its course. There is no right or wrong here, just views moulded from our life experiences.

Anonymous said...


I see your point on teaching the young the value of money. It is not just money. I see many parents are still sending and fetching their children from school. Sec 4 and above mind you, not primary level. How are they going to be independent when the parents are right behind to catch them when they fall ?

Provide enough of the basics, school, tuition if need be but stop at the luxury. EC classes if they are interested. Taxi everyday, pay your own unless it is raining or late at night. Economy rice is standard. Waygu Steak ? Earn and pay your own.

Ultimately, parents decide the values they are going to pass down to their children even unconsciously.
Monkey see, monkey do. I am sure you have heard, “ My mom or dad also does that.” How the 2nd generation bring up the 3rd generation will determine whether the wealth goes on to the 4th generation. Only in adversity will the strong thrive. Look at how Japan and Germany progress after WWII.

I have to qualify that I do not have children.


CreateWealth8888 said...

Wait until you have own children then you may sing a different tune.

You don't give. But, your wife may give in to your kids and if she is using her own money. So how? Start a quarrel meh?

Sanye ◎ 三页 said...

Fully agree with Createwealth8888. In fact that is exactly my problem. While I try very hard to teach my children to manage their own finances, my wonderful wife will spoil them. So at the end, I have to give in.

The thing about parents right behind the children to catch them whenever they fall - I totally agree too. But that is Singapore style, nothing unusual. Even our PM has a mentor to guide him, so what?

Anonymous said...


That is for you and your wife to settle. Who would dare to tell you how to raise your children ? No problem about myself because me and my wife do not intend to have children and it was mutual consent.


If you decide it is not unusual and you can live with it, I have no quarrels. To each his/her own. We are just sharing opinions. I have no monopoly on child raising ideas.


Anonymous said...

As parents, whether we are well to do or not and whatever are our value system & belief, I am quite sure most of us if given a chance to think seriously about it, want to see our children can stand on their own two feet eventually.(It should be all parents's main duty).
All chicks or parents have to leave their nest one day.That's why very wise parents usally will have "trusts" for their children who they think can't stand own their own two feet for life.

financialray said...

Just to share my own experience.
When I was in NUS in the 1990s, there was this female classmate who had never boarded a SBS bus her entire life. She actually asked us how to board a bus when a group of us decided to catch a movie. She has been chauffeured all her life and probably either driving or still being chauffeured now. Think her parents smarter right? Rather than give her a few thousand for transport. LOL. Pigs are more equal. Its a universal fact. So is widening income gap. We cannot complain. They will just tell you its happening everywhere in the world. Pigs are everywhere.

Kyith said...

i may not have children but would like to chip in the discussion humbly.

When it comes to teaching children, there seems to be no default user manual unlike computers.

but perhaps thats the problem. we rely alot on old chinese teachings, which worked really well for our generation.

but many of us, as we become parents, we start to do things alternatively. we visit forums for new age child upbringing techniques or due to lack of time we dote more on our children.

it brings more harm than good sometimes. we instill self-centered behavior even though that is not our intention.

i wonder if you guys see the shift in that direction.

Createwealth8888 said...

one kid family will have everything for his/her own.

Three kids family will have to share a bit among themselves and younger ones may have to reuse some of the older ones e.g. on toys or clothing.

Get it? Have more than one or none at all.

Anonymous said...

Working parents have no time for their children, so they give money.

I think it is ok, provided they impart some values too.

Kids learn from their parents.

Musicwhiz said...

Hi LP,

I won't be too long-winded on this.

All I want to say is that I support your stand, and that parents should not over-indulge their children even if they have the means to do so. Kids who grow up not understanding the value of money will only do harm to themselves and subsequent generations.


Caro said...

That's a bad habit.