Kids can sometimes insists on demands that are detrimental to your financial health. Here are some of the most common things that parents waste their money on, and suggestions on how to stop that from happening.
The cash drain begins even before the baby arrives: Pregnancy expenses
Pregnancy is a magic period for retailers. This is when cashing in on the unborn one takes root. Terms like ‘nesting’ stage and ‘the best for your baby’ start doing the rounds. In terms of money, these roughly translate into the following:
- An overpriced and fancy nursery for the baby.
- Toys and ‘development aids’ in various colours and textures.
- Seemingly indispensable but actually useless appliances and equipment that will never be used again.
- Elaborate baby announcements.
- Expensive first month parties.
- Buy pre-owned stuff for the nursery and other baby gear.
- Steer clear of gadget traps laid out especially for first-time parents who want to go that extra mile.
- Skip the parties and put the same amount into a savings scheme for the child instead.
Toddlers are these incorrigible budget guzzlers who burn a hole in your pocket in complete innocence. The actual culprit is the overindulgent parent. In fact, this is the stage when you as parents must start drawing ‘the line’ between giving in to your kids demands and buying things that are essential for their development.
Here is where parents usually go wrong:
- Buying expensive presents and organising over the top birthday parties for children who are too young to appreciate them.
- Buying designer clothes that invariably get holes in the knees and elbows because the toddler is still finding his step.
- Going grocery shopping with kids is a cardinal sin – there is a reason that cartoon sponsored items aimed at kids are stacked on lower level shelves – at toddler eye level!
- Planning movies for little children with zero attention span – kids more often than not create a nuisance, fall asleep, and end up not following the movie. To add to the loss, your movie experience is ruined and you are left with a bill for overpriced popcorn.
- Eating out is another pointless expense. Kids invariably leave what you ordered especially for them and ask for something else, or inexplicably go on a hunger strike after the food has been ordered.
- Celebrate birthdays sensibly – children only remember the fun they had, not the theme-styled décor and brands.
- Shop for clothes and toys during sales, online, or at non-branded stores.
- Organise a movie date at home, pop your own corn, and couple it with a dinner that you ordered in!
Tweens and teens can cost you more than you thought possible!
What used to be the bane of teenage life has now infiltrated the young impressionable minds of tweens. Addiction to electronic games and gadgets, not very useful but trendy after-school activities, peer pressure for fashionable stuff and eating out, the need to be dressed in and use branded products – it’s all there before your child turns 10 and carries on way into the teenage years. So watch out for the following:
- The technology trap that is infamous for being a bottomless hole from where there is no return. Fun and addictive, gadgets also cost a bomb, and get outdated barely weeks after their much touted launch.
- We think we are saving money when we buy yearly passes for entertainment. Usually, you go once and the charm is over. So it ends up being a colossal waste of money. Think twice before you get the annual passes.
- Don’t indulge children with stuff like inflatable pools and trampolines; they cost too much to buy and then even more to maintain.
- Buckling under peer pressure and constantly letting the child go out with friends for movies, entertainment, and eating out is another budget breaker that has no boundaries.
- Falling into the fashionable clothes, shoes, and accessories trap.
- Ordering out is another money drain – you spend through your nose on unhealthy junk food.
- Extravagant holidays can wait. Let them grow older to appreciate and enjoy the experiences.
- Make kids contribute pocket money for gadget purchases and watch the demand reduce.
- Show them the way to the neighbourhood pool or park.
- When peer pressure rears its ugly head, help them to design their own finances instead of just saying ‘no.’
- Set days and budgets for friends and entertainment. Explain the futility of brands by showing then what you can do with the extra money instead.
- Choose holidays wisely – let them be reasonable, fun, and informative, instead of a luxurious trip to the other end of the world.
It goes on all the way to university!
A child’s ‘dream’ university can sometimes be a nightmare for parents. A really high-end overseas university with its exorbitant tuition and ‘miscellaneous’ fees could cost you your retirement fund. Here’s what parents should keep an eye out for:
- Choosing a university based on mere rankings. Ranking change. The focus should be on the courses that interest your child. Choosing a high-ranking university may drain your money while not benefiting him/her at all.
- Buying your child a car to commute.
- Discouraging the child from picking up any part-time job, afraid that it would impact their academics. This one is a cardinal error. A university-going student should take up a part-time job to learn how to manage time better and become financially independent.
- Inspire your child to bag scholarships in college.
- Encourage them to recycle and reuse. Instead of buying all books, using the library resources is far more effective.
- If they are adamant about going to that expensive university, ask them to contribute to the budget. Often, this helps change choices, or really makes them work hard to earn it.
Keep reading the BankBazaar blog for more insights into how we spend, together with tips to master your money and get better at life.