Warning: the first few paragraphs of MoneySense’s personal finance feature today may read like the diary of a rich, spoiled brat:

When Mardie and I married in 1999, we were better off financially than other newly-weds. We already had a townhouse (my parents helped with the down payment), acquired through a loan from the Government Service Insurance System. I was working then as a lawyer at the Securities and Exchange Commission; Mardie just finished a contract with a foreign firm and started a consultancy business.

We weren’t concerned about other things as I was pretty much relying on my parents for support. Being the youngest and only girl in a brood of six, I had lived a stress-free life especially about money. My dad was and still is a great provider. Growing up, there were plenty of extras and luxuries (I had a credit card when I was a teenager in the 80s), so at a young age, I was used to buying stuff without thinking of how to pay for them. I actually did not give up my dad’s credit card until a few years after I got married. I knew I could always count on my parents to foot some of the bills and pitch in whenever we had money emergencies. Deep down, I felt that my husband was uncomfortable with this set-up, but he seemed to accept it, and was never resentful.

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Guess which toys my two-year old son played with the most?

This Leapfrog overpriced invention that sings the alphabet for him while mom looks on?

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Insurance for children are cheap, sure but in this case, “cheap” doesn’t equate to “good buy.”

The reason is simple. Children don’t need insurance. Our personal finance feature for today says:

Children do not need life insurance. You are not dependent on your child for your income. If your child passes away, you can still continue to work and earn, and life will still go on for you.

Read the entire article here.

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An employee for Japanese toy maker Sega Toys displays the world’s smallest “Grand Pianist - Hello Kitty Version”, which has 88 working keys and can automatically play 115 pre-installed musical songs, including 15 Hello Kitty related pieces. The original version of the Grand Pianist started selling in Japan in April and the new white Hello Kitty version will be put on the market next month.

Eighty-eight days to go before Christmas! Many of us scrimp and save the whole year, only to lose it all in December. Parents go crazy buying the best Christmas gifts and serving the best Christmas dinners, mostly to assuage our own guilt when we feel we haven’t spent much time with our kids the rest of the year! I’m guilty here too hehe.

If we wait until December to decide on a limit for Christmas spending, it’s easy to be swayed by great commercials and amazing packaging. Hubby and I used to have a “skies the limit” attitude when it comes to getting gifts for the kiddos, but lately, we have decided as a family to lie low on consumerism and focus on what’s really important – family, togetherness, and of course a gift that doesn’t take away the spirit of what we actually celebrate on Christmas time.

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Sure, you can get rich with a big inheritance from a great aunt you don’t really know. The source of real financial independence, however, comes from the little money decisions we make regularly.

This article from Lucena City, courtesy of the Philippine Daily Inquirer’s Southern Luzon Bureau, says volumes:

LUCENA CITY – Schoolchildren in northern Quezon towns are contributing a few pesos of their daily cash allowance to help fund a campaign against government dam projects in the Sierra Madre mountain rivers and avert a possible environmental disaster.

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I don’t know if keeping money matters among adults is unique to Filipinos, or even Asians. Time and again, I have seen parents send children away when talking about financial matters. It’s not just that we don’t want our children to worry. It’s just that not many Filipino parents are comfortable telling their children how much they really earn.

However, trusting children with cash is at the heart of teaching financial literacy in the home. If we want them to understand money, we have to let them handle money. More importantly, we have to truly empower them to decide, after we have taught them the right principles behind money management.

I know of a mother who was widowed and had to feed and clothe four children alone. Gainful employment was hard to find because she was a homemaker before her husband died. It was very tough for the whole family.

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Most financial planning experts agree that it’s best to start early when teaching children about money. If there’s one thing that Filipinos can do now to raise the country’s savings rate in the future, this is it. One child at a time.

Allowance appears to be the most popular tool to do this. INQUIRER.net’s personal finance article today says money management is conspicuously absent from most school curricula, which means lessons on financial literacy should begin at home. Citibank answers this question from a reader:

My husband and I set the allowance for our eldest child, now in 2nd year high school.  We wanted her to have enough money so she won’t go hungry during the day, but not too much that she can buy anything on sight. Just one month after school started, our daughter is complaining that her allowance is “too small”.   Now, we’re thinking maybe she should just bring “baon” and we’ll cut her allowance.  What do you suggest? – Benny C.

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I’m playing catch-up with a grin on my face, seeing that this blog has been active despite my absence last week. What a magnificent thing it is to see people sharing experiences, knowledge, and skills unselfishly with each other. Thank you!

Last week, INQUIRER.net’s personal finance section featured an article on money lessons for children. Some of the advice may surprise parents. Instead of the traditional “teach children how to do with less”, the article talked about giving children extra allowance so they would learn to budget their extra money. It talked about teaching children the importance of saving, investing, keeping good records, of being content with what they have, of being good stewards of their belongings, of learning how to give to others and enjoying the fruits of their labors so they will not turn out to be misers.

Good, basic advice. Unfortunately, they will all be useless without consistent practice. Let me explain.

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SPENDING the weekend in Tagaytay didn’t seem to be a good idea at first. Vacations, even short and simple ones, cost money. Money Smarts was just a little bit cranky, adding up the cost of gas, accommodations and food in her mind.

But as our little family car left behind the hustle and bustle of the city, the swaying coconut leaves and gentle rolling hills of Tagaytay slowly lifted our spirits, willing our city-tired muscles and tense nerves to relax.

This trip got me thinking about times when it’s best not to hold back on spending. Money Smarts is all about discipline, restraint and, well, being money-smart of course, but there are times when holding the purse strings too tightly may not be a good idea.

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How would you like to hear a 9-year old kid talk about marketing strategies, loan agreements, supplies, wages, taxes and…uh…thinking out of the box?

Henry Ong, president of RFP (Phils) Institute has cooked up another project — this time to teach children how to be entrepreneurs. No, they won’t be asked to listen to lectures or even interactive classroom discussions. They will actually be asked to think of a business and run it for a day.

Cool, huh? Read all about it here. Before I even mention something in MoneySmarts, I go through it, test it, see if it works. There’s too much at stake and no, I am not being paid to advertise it. So there. Nothing can be more precious than integrity.

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