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Financial freedom: Your children will become what you are.

Sunday, November 2, 2014

I was out and about when I overheard a conversation a father was having with his young son whom I thought must be 9 or 10 years old.

Son: Daddy, can we go to USA for holiday? My best friend says his family is going to USA next month for holiday.

Father: Go to USA? Will be very expensive.

Son: Mommy says maybe next year we can go.

Father: See whether daddy gets a good bonus or not this year. OK?

Son: Cool! I pray tonight and ask God for help.

AK thought to himself: 

"I will pray for you tonight too."

Of course, it is no business of mine what the father decides to do but if I were in his shoes, I know what I would have said to his son. 

I am sure you know what I would have said too.

I strongly feel that delaying gratification is something we should teach the young even if we are very rich and money is not an issue.

Something I said to my niece before was how she could be getting free money as a young working adult because of her investments in stocks made in the last few years. 

Basically, by the time she is in her early or mid 20s, she would have recovered her capital invested. 

The annual dividends that she could continue to receive then would basically be free money.

I fear that many people are trapped, running like hamsters in their wheels. 

They are not able to make progress in their financial well-being as they are stuck in a culture of consumption and instant gratification. 

What makes the wheel scarier is that people accept it as an integral part of life and, therefore, their young will also have wheels of their own in future. 

It is a depressing thought.

"Your children will become what you are; so be what you want them to be," David Bly.

Related posts:
1. Financial freedom is a family affair.
2. At what age to start investing in stocks?
3. They were just showing off their wealth.

More needs to be done to provide Singaporeans with investor education: Lawrence Wong.


Ana said...

What a timely reminder!
I do wonder what type of parent I would be if I had children. One thing for sure, had I been a mother in my 20s, I would not have the wisdom to teach my children to fish....
Now that I am older, and have more experience in
Life & finances..... I hope I would truly teach my future child how to fish.

athulican said...

It's a balance between delayed gratification and taking the reward now so we don't regret later. What if next year the father really get a good bonus but suddenly detected got cancer?

temperament said...

i say delay gratification should be measurable or clear cut. It's not so much about money only (affordability) but about how much more potential returns you can have. Like if you buy this gamer at this airport compare to reaching home you can buy the same gamer but with 8 to ten times more games for the same price.
My son who was only at the age of primary 3 or 4 understood the differences then that delay gratification at that particular airport was well worth the reward he was going to get back home.
He understood the vast amount of different in the number of games. But also we let him know he could only make one choice (purchase). Either buy here now at the Australia airport or when we reached home.
So he understood and chose delay gratification because he could see the real differences.

Sunny said...

Hi AK,

This has nothing related to the above topic. It just came to my mind after reading the "cancer" part.

Is there a way to will my existing shares in CDP as a inheritances for my children if I passed on?I have tried googling for an answer, but unfortunately could not find any info on this.


AK71 said...

Hi Sunny,

I believe you have to be quite clear in your will which stocks and in what quantities to leave to who. See your lawyer to get this done. :)

I found something online but it pertains to the USA:

AK71 said...

Hi Ana,

Sounds like you are ready to be a good mother. ;)

Well, I am not sure that I would have been able to do a good job of parenting in my 20s either. I like to think that I have grown wiser with age. ;p

AK71 said...

Hi athulican,

I like to tell people that there are luxuries which I find affordable and I indulge in them once in a while. I term these affordable luxuries. Indulge sparingly.

Then, there are luxuries which are beyond me. These are luxuries which I would have to save up or require a windfall for. These luxuries, I should forgo. I am not ready for these.

So, in this instance, I believe that the trip to the USA is something the family should forgo. It is not an affordable luxury for them.

AK71 said...

Hi temperament,

It depends on how long the delay is. LOL!

To wait a few hours or a few days is relatively less challenging than to wait for a few years.

I would ask your son whether he wants the gamer for free. Invest his savings and wait for a year or two. LOL. ;p

temperament said...

i think you have different understanding of the psychology of delay gratification for children. There were many experiments carried out on children's different behavior on delay gratification. And how they behave as adults many years later.
And words delay gratification may be an inherent attributes in some children. AS adults ???

AK71 said...

Hi temperament,

Indeed, I have almost zero knowledge of child psychology. -.-"

However, when I see how my niece behaves when she sees dividends being paid to her year after year by SPH, I get the feeling that children aren't so different from adults. ;p

Singapore Man of Leisure said...


I lucky single and no children!

If not, I moody moody wake up Monday morning only to get stress from single person with no children on how to bring up my children?

Like that also can?

You har! Like to live dangerously on the knife's edge...


pf said...

I think it really depends on each one's circumstances. Say to a child who has all his needs taken care of and has met with rewards for delayed gratification, probably the child will go for that. However, if a child do not have all his needs met in a consistent manner, there is always the fear of getting nothing if he does not grab what he wants when there is opportunity, then of coz no regard for delayed gratification. And then of coz there is the child who gets whatever he wants whenever he wants, he will not have concept of delayed gratification.

Isn't investing/trading a large part to do with emotions and behavior? :)

AK71 said...


Orh. -.-"

To all fathers who woke up moody and read my blog this Monday morning, I am so sorry. Please forgive me. :(

AK71 said...

Hi pf,

I do not doubt for a moment that kids could behave differently given their backgrounds if left to their own devices.

However, I also believe that it doesn't matter if a kid comes from a rich or poor family if the kid is well brought up.

So, how a kid behaves is a reflection upon the parents.

Kyran Tan said...

Hmm, I guess if i ever become a parent myself, i will try not to hide anything from my kid. Kids are much smarter than we think they are, with all the stuff that they are exposed to anyway. Show them at face value, in this case, show them an excel sheet on how compound interest would reap for them. Getting them intrigued is probably easier than telling them what they should do.

Siew Mun said...

When my son eats a hotdog bun, he saves the best for the last i.e hotdog. That is delay gratification which came naturally, we did not teach him. I am not sure as you grow up you pick up bad habits going the opposite way.

AK71 said...

Hi Kyran,

Oh, kids are much smarter these days. I think it has partly to do with having better nutrition. ;p

It is always a good idea to explain why we do certain things than to just issue orders. :)

AK71 said...

Hi Siew Mun,

Actually, it is debatable whether the hot dog or the bun is the best part of a hot dog bun. I was told that hot dogs are actually very unhealthy and full of artificial stuff. OK, please pardon my mischief. ;p

I know what you mean. :)

pf said...

How the kids is being brought up sure plays an important part....however, its doesn't make up the total. ..a lot has to do with the development of the child.'s_stages_of_psychosocial_development

Sillyinvestor said...

Hi AK,

This remind me about a US study which "accidentally" track a group of pupils from Detroit for donkey years, 50 years iirc.

The verdict, a very small percentage actually break out from their vicious cycle. It raise doubts about education as a social lever.

It is said that those with single parents become single parents by 18, those with drug problem has kids that go in and out of jail.

Those with middle social status continue to enjoy that. That are more from this group moving upwards, and if my mermory do not fail me, only 2 break out of the vicious cycle out of the sample group of hundreds ( 500, I think )

There is a saying values are not so much taught but caught. Caught it from parents, then peers then teachers.

We want our best for my kids, we must be a example, this is not a slogan but a tragic fact.

qook said...

Hi AK, nice post. I wonder though how would you try to inculcate delayed gratification in an adult? My SO is always puzzled at why I work so hard and squirrel away as much as I can by investing for the future. I've tried hinting to him the importance of being prudent and frugal but he likes to live life richly.

Casey said...


I have to say delay gratification might not be a good idea for some children. My daughter in P3, has been so used to it, that I started to regret for inculcating her this 'value'. Have you ever seen a child who has difficulty to buy a souvenir in Disneyland, a child who think that going to Universal Studio is waste of money, a child prefer to stay at home than joining a Hokkaido trip during school holiday? When a child think that she/he can live without almost everything, she/he would have lose his/her innocence 童真,lost her/his childhood forever.

Life shall not be only about how soon one can be financially free, life should be about living with passion, financial freedom is just a bonus.


AK71 said...

Hi pf,

Oh, I am no expert on child development but based on my own observations, I believe that parents play a very big role in how children will turn out in future. In fact, from what I see, parental influence very often lasts into adulthood. -.-"

AK71 said...

Hi Mike,

Values are caught and not taught. I must say that mostly rings true.

We can try very hard to teach values and good habits and hope that they are caught after some time but they are best caught if they are truly pervasive in the family. :)

AK71 said...

Hi qook,

Try nagging. Hahaha... ;p

We can explain why we do things to anyone and hope that the other party is really listening. If the other party has a fairly good amount of common sense, I dare say that he would see the light. :)

If he believes that he needs to have a million dollars before he could retire at age 65 and if he doesn't think that he will have it by age 65, then, you want him to read "Wealth Creation: $1 million trilogy" found in my blog's right sidebar.

Hope it helps to inspire him. ;)

AK71 said...

Hi Casey,

Children usually act upon their feelings. That is why they have to be taught to think on different levels as we prepare them for adulthood. Otherwise, they become Tarzans.

Although you might now think that you have taken away your child's innocence, I believe that you have done a good job and your child will thank you in future. :)

temperament said...

"Too much of a good thing" (overemphasize) can become "bad" too. Just like after becoming someone like LI KASING can you move about like a nobody.
There is a price to be paid when you are in either "extremity of life". A genius to the extreme after cross over is a moron.
So is middle path the best for most of us? i don't think so. i think it all depends on the situations or the goals.

Jes said...

Hi Ak,

I believe the best leader leads by example... 以身作则 is definitely applicable. If the parents do not know about delayed gratification, how to teach it to the kids?!

AK71 said...

Hi temperament,

Of course, what I am sharing is a philosophy which I think we should embrace. Whether or not it should be embraced and how tightly it should be embraced is up to the individual to decide. ;)

Recognising that the philosophy is a good thing is only the first step. :)

AK71 said...

Hi Jes,

Unfortunately, I believe that the problem is rather common. More than half of the people I know are not the type to delay gratification. -.-"

I can only hope that the young ones will benefit from the national financial literacy program which are being implemented in our schools now. Life could be and should be better. :)

Lim Der Shing said...

Ask, have you given thought to how much to leave each child? We want to give enough to help each kid get a start but not so much as to stop them from working. Also there is the issue of giving each child the same amount or else they feel we love them less! What are your thoughts?

AK71 said...

Hi Der Shing,

How much money should we leave to each child? This is something I don't currently have an opinion on and even if I do, I won't reveal it. This is because it is no longer just a philosophy we are talking about then. ;)

I shared a personal philosophy here but whether it would be adopted or not and to what extent is for readers to determine. :)

Rebel said...

U can put it in your will or your trust stating clearly the division of shares.

If two kids get 50-50% in the will, and they try to divide it into equal portions but due to odd share lots, one kid gets abit more, that extra lots are subject to tax. Ask mr taxman if he wants to collect the tax on that ( it may be a trivial sum)

Also read IRAS chapter on :-
Income from an estate
Income from a trust.

AK71 said...

Mrs. Spoon says...
I have also heard parents trying to encourage the kids to study hard by telling them that if they wish to buy the car, they have to work hard to learn lots of money. what do you think of that?

AK says...
Being well educated, successful and having a high earned income in order to buy expensive stuff is not a bad thing per se but if that is what we mostly do, then, there is a good chance of working till the day we die and as a pauper.

AK71 said...

“If you buy things you do not need, soon you will have to sell things you need.” W. Buffett

AK71 said...

Jean Yap said...
Hi, Can u suggest what the father should reply to the child when the child say ..."Daddy, my classmate's family just moved into their new condominium. Has swimming pool and tennis court. So nice."?

Blogger AK said...

"Maybe you can swim and play tennis with your friend in his condo in future."

Keep it simple lah. ;p

Now, if the child had asked:

"Daddy, can we move into a condo too?"

Then, it would require a full lecture on financial freedom! ;p

AK71 said...

Tong Xiang Yap says...

Common question from the young kids, I faced the same too.

I told my son, everyone is different, we should love our house/our home.

He replied yes I love my house v much so don't sell away.

Reality of life, children will compare too. Up to us how to educate them properly.

AK71 said...

Adrian Chin says...
Kids are entertaining.

AK says...
Entertainment is a consumption item ;)

Adrian Chin says...
perhaps we should teach from young about our values

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