Teach youth how to invest their money
As a compulsive saver (for which I thank my parents), I am fortunate to be unconcerned about overdrafts, or accumulating interest from minimum-fee repayments on my credit card.
This despite my living in the world’s second most expensive city, London.
In fact, my compulsive saving intensified when the parental safety net was removed. Now, being broke means I will actually have to survive on rice and frozen peas.
However, saving is only one aspect of financial management - and I fail miserably in knowing how to invest my money.
I wish I could make educated decisions about stocks, shares and bonds, or the slew of investment opportunities that banks offer.
In fact, I wish financial management had been a for-credit option in the curriculum - that I could have taken it to replace part of a core subject (I’d replace vectors, complex numbers and first order differential equations).
Adrienne de Souza, 21, is a third-year biology student at Imperial College London.
Introduce financial education in schoolsYOUTH here are taught the importance of saving for a rainy day and delayed gratification. Unfortunately, that is where the education stops.Many are clueless about investment, and the most they know is that putting money in a bank earns more interest than in a piggy bank.Savings deposits alone are inadequate as their value is eroded by inflation.
As youth are not yet burdened financially, they are in a better position to invest in long-term assets.
With the advantage of a longer time horizon, youth should start investing as early as possible.
Currently, our national financial education programme, MoneySENSE, educates citizens on issues such as health insurance, the Central Provident Fund and saving for retirement. It has also reached out to schools, which is a good start.
Financial education can also be introduced in schools as a non-examination subject.
Chew Zhi Wen, 21, has a place to read law and economics at the National University of Singapore (NUS).
A lesson that cannot be taughtWHEN I started studying in Australia, I was shocked to find that most of my peers had part-time jobs.It is the norm in Australia for parents to stop giving their children allowances once they turn 18.That idea may seem revolutionary to youth here.
Having a part-time job and studying means having to balance commitments at school and at work.
The youths also have to manage their finances - balance their budgets for rent, food, travel and entertainment.
Overseas students face a similar challenge.
Having to plan and execute a budget on a daily basis is something most of us rarely do while living with our parents, where everything is provided, and taken for granted.
Financial responsibility cannot be taught in an institution - it is one of the many lessons in life we pick up along the way.
Tabitha Mok, 21, is a fourth-year medical student at the University of Western Australia.
Is ignorance or materialism to blame?REPORTS of people chocking up credit card debt abound and poor financial literacy has been blamed.Maybe the problem stems from greed and the tendency of those in debt to live beyond their means.When given a choice between a Mercedes and a Mitsubishi or a condominium and an HDB flat, many would probably go with the first and more glamorous choice.
They measure their quality of life from the things they own. It becomes a problem when, in trying to ’show off’, people end up with irrecoverable debt.
Instead of teaching financial literacy, perhaps we need to examine the root of materialism in society.
Ng Yixun, 19, is a pre-university three student at the Millennia Institute.
It ranks as an important life skillI RECENTLY suffered two monetary mishaps which awoke me to the perils of financial laxity.The first, a bounced cheque on an account which was 56 cents short. The second, a hefty late payment charge for an $8 card bill I figured Giro would take care of.I learnt two things from the penalty charges: that ‘tuition fees’ are necessary before we take debt seriously, and that banks are waiting to profit from our slip-ups.
Financial literacy as a life skill ranks up there with tying your shoelaces and learning to get along with others - it should be taught from the time we learn to walk.
With bank credit often designed to encourage debt, it pays for students to adopt the role of enlightened consumers from early on.
Abdullah Luqman Hussin, 25, is graduating in sociology from NUS.
You can’t learn it from a textbookIF SUCCESSFUL financial management could be learnt from a textbook, I dare say Singaporeans would be millionaires by now.Introducing financial management in schools may seem practical, but in reality, it is only useful if one has already made a commitment to be financially aware.It is a process that starts from a young age, in which parents play a fundamental role to teach and reinforce concepts like a budget and the value of money.
However, the final step lies with the individual’s choice to make such a mindset a priority in life.
Melissa Khong, 21, is a final-year music student at the Manhattan School of Music.
This article was first published in The Straits Times on 23 June 2008.
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