Money - a hard lesson for our children to learn

Many parents living in the UAE are faced with the conundrum of how to teach their children about money when living in such an opulent environment.

Illustration by Gary Clement for The National

Of all the things we can teach our children, I believe one of the more important life skills is money management. Many parents living in the UAE today are faced with the conundrum of how to teach their children about money when living in such an opulent environment.

Growing up, I remember a movie that influenced my life. I was in primary school and the movie was Tootsie - the big city life of New York seemed like a dream for a country girl who grew up on a farm. Then in high school I had another dream, to go and live in Brazil. These dreams fuelled my drive to earn money. For me, independence began with getting part-time work and earning money to do the things I wanted to. My first part-time job was at the age of 15, milking cows with my dad to help pay for my Rotary exchange to Brazil the following year.

I worked hard for the trip, which was a life-changing experience. The importance and value of earning and deserving the experience made me proud - it wasn't just handed to me, I worked for it.

Teenagers living in the UAE today are not afforded such experiences. Ironically, amid the wealth and convenience, the honour of earning a dollar is being sacrificed. "Normal" to them is an apparent abundance of wealth - be it fast cars, fancy shopping malls and private schools.

Of course, this is not their fault. It is simply because of the limited part-time work available to them, coupled with the fact that their parents are earning decent wages and not paying taxes, so they get a taste of the good life. But what happens when our teenagers move away to go to university?

Regardless of my previous overseas travel and work experience, the move out of the family home to university was a big one. Living in the city away from my parents in a cheap-looking flat with orange walls and few friends wasn't easy. I barely passed my subjects, worked three part-time jobs and still didn't have a cent to my name.

My measly pay cheque was barely financing the glamorous, independent lifestyle I had envisioned. I would look at the other city kids, living with their parents, while their part-time wages went towards partying. Mine addressed food, bills, tram fares and the bus ticket home on the weekend to see my family and my boyfriend, and to enjoy a home-cooked meal. In life, belonging is key and I didn't really feel I was earning enough money as a student to belong anywhere.

But the answer was not my dad giving me more money - although I certainly did ask.

Today, kids are given mobile phones in their teens and credit cards well before they turn 20. Who pays that bill? In many cases, it's the parents bearing the brunt of the financial burden.

An alarming article in The New York Times reported that a growing number of parents were going into debt to pay for their children's study loans. The US Treasury department found that close to 120,000 Americans were losing a great portion of their Social Security grants because of rising debt in the form of student loans.

There is some relief for university students in the United Kingdom, however, in the form of a new system, a "graduate tax". Under the old student loan conditions, graduates were required to start repaying their study debts once they started earning £15,795 (Dh91,553). This number has now been changed to £21,000. As their salary rises above this threshold, 9 per cent of their wages will be automatically subtracted. This helps entry-level workers on lower salaries as they are effectively paying less tax monthly.

A useful guide for parents and students alike is the website www.moneysavingexpert.com. The site not only offers insight into the different repayment options, but features a handy tool for calculating exactly what those monthly repayments will be.

As it turns out, living in Brazil on an exchange programme taught me many life lessons. Most of all, it gave me a taste of the life experiences I was after, perhaps even living and working overseas. After a year of university life, my dreams were the same, but "not belonging" drove me into making a decision. I realised I needed to get a real job, an income, make friends and complete my degree part-time.

Fast forward 10 years, and life has changed a lot for me. I have enjoyed a career that took me first interstate in the US then around the world; I have bought and sold my own investment properties many times, and I finally graduated after many hours of late-night and weekend study. All of which I achieved without a credit card.

I sit here today and write this article from a desk in Dubai, a place I now call home. I am married and have a son and I am so happy to say that yes, I am 100 per cent living my dreams. Getting here was not easy, but it was the path I was determined to pursue. And if I had fallen into credit card debt at a young age, very few of these dreams would have been realised.

Teaching teenagers to think for themselves and stand on their own feet will be our greatest test. My mornings spent milking cows with my dad may be your child's blog or e-business venture. Make the time to ask your kids what their dreams are and then ask them how they plan on funding those dreams.

The value of knowing you're able to fuel and fund your own dreams is simply priceless.

Janelle Malone is a writer, blogger and commentator on personal finance. You can contact her at www.womenmoneyandstyle.com for any further financial questions you may have