Spend, Save and Invest Smartly

Is the Money spent on Your kid an Investment or an Expenditure

Investing Planning:

Investing on our kids can be considered as an emotional long term investment and there is no other investment which is as important as investing on a kid is for any parent. We always dream of making our kids doctors, engineers, MBA’s, Civil Service Officers and many more right from the day one of their birth. In the process of realizing our dreams we spend a huge sum of our earning or saving or wealth on them. You may wonder why I am counting the money spent on our own kid or why I am talking about investment and expenditure.

Yes, just for a minute think practical and say why we want our kids to be in a better position or why we want kids.

Of course, the answer should be, either we want them to take care of us when we are not earning; or when we can’t help ourselves; or we want our own kid as the representative of our family in our absence; or we want the continuation of our family tree. And please be little more practical to accept the fact that all the other material things you create in this earth are mostly created for our kids or will be transferred to our kids, right from our house, investment in various means and your name and fame.

The process of bringing up a kid till he/she becomes a grown up and matured man/woman in the society is a very long term process and the risk is very high during this time like investing in stocks. Investing in stocks may give you huge returns sometimes and may not return even the principal amount sometimes. Similarly, investing on our kid may yield us back huge returns (which can be name, fame, wealth, etc) or many a times it may not even consider us as the owner of that investment.

Yes, dear readers, that is what is happening across the globe in many families today. Most of the parents have lost complete ownership right on their kids. It is high time to understand whether we are spending our time and money in the right way or not. We must also recheck whether this spending is expenditure or an investment.

If you are buying a good shirt, book, food, required entertainment or something which will fetch you the desired results, then it is an investment. But if you are not stopping your kid from using your hard earned money for smoking, useless hangouts with friends and any such things, then it’s a pure expenditure which won’t fetch you back anything.

I was explaining, what is corruption to a group of participants at one of my recent seminars. Corruption does not start with Government officials or Politicians, but it starts at home when a kid is aged 8 or 9. If you give Rs 100 to your kid to buy groceries for home, he will come back and say that he spent Rs 80 to buy the items where as he had actually spent Rs 70. He is taking Rs 10 without your permission. This is because of the failure of most of the parents in making their kids realize the importance of every rupee they spend from their parents’ earning or saving.

Investment Planning Information:
Things to Keep in Mind

There are many things that you need to keep in mind when you try to mold your child;

First thing is; Do not waste your time by telling your kids to study instead make them understand why they have to study. There is no point in injecting information into their mind unless and until they realize its value. What I mean to say is instead of teaching them 1+1=2; make them understand how it is 2 and why it is 2 by quoting good examples.

Secondly; Never make your kids study for marks make them understand the importance of learning every new words, concepts, etc.

Two things which make human beings different from other animals are Memory and Logic. Whatever human beings have created today are the outcome of his logic and intelligence. As I told earlier by-hearting the things will help them only to improve their memory power but understanding the facts will develop their logical reasoning power. This will gift you a wonderful kid with a high level IQ (Intelligence Quotient)

When your kid takes birth he/she is like a newly purchased computer which has no software installed in it. You will have to install the required software when time comes and update it as and when required. For example if you are an accounting professional and handling only accounts related works you don’t have to install Photoshop (a designing software) in your system because it is not at all related to your job. Like the same mold your child with the required skill and capabilities which will help him/her in the future to achieve great things in life.

Let us take one more example; Imagine you are trying to open a word file in your system without installing MS Office. Do you think the file will get opened….??? No way…!!! It is your mistake that you didn’t install MS Office in your system, after doing such mistake how can you expect your system to do that action…..???

A computer can run with all these features only when operating system is installed in it and your kid’s operating system is nothing but the culture, character and the skills you inculcate in him/her. The kid will become a successful doctor, engineer or something else you expected only when all these fundamentals are strong.

There is one more thing you need to look into ie; before trying to install a program in your system; you should make sure whether your system is compatible with this program. For instance there are softwares which are compatible only with Windows Vista, if you try to install it in windows 98 it will not work. Like the same before deciding on what your child should become, you should know his/her tastes, interests, talents, etc. Ask them what they want to become, only then you can create a find blend of ideas which will take them to success.

I have quoted this example to make you aware of your role in building your child’s career. If you want your child to become a doctor, create such an atmosphere in your house from the day one. I am not telling you to buy the complex medical equipments and place it in your house, instead make your child feel the importance of this profession, tell him/her what a doctor does, how important a doctor’s service is to the society, how he saves people’s life, etc.

Today most of the doctors, engineers and other people carrying big designations are unable to present themselves better in front of a crowd. This is only because of the lack of basic skills training.

Parents enjoy their son or daughter going to college even at the age of 25 or 30. If you make your kid engaged only in preparing for the life till the age of 30, when do you expect your kid to stand on his/her own.....? This is the mistake generally parents do, they concentrate only on giving education not on its implementation, by the time they complete their education they will become bookworms and will not be in a position to make the real use of knowledge.

Today’s world is very attractive and the chances of your kid getting attracted to too many thing is very much possible. But have you built the required resistance power in him/her to judge and choose what is good and what is bad….???

To bring up a kid the parents’ contribution is just 50% and the rest is absolutely from the world around him so make your kid to contribute equally to the society and the nation as he/she takes care of you.

Financial Planning
Tax Planning
Investment Planning