09-12-2010, 10:45 PM
(09-12-2010, 10:07 PM)arthur Wrote: [ -> ]I belong to the latter category, and that was why I knew how compounding interest rate worked for the BANKS.
In a way, I received exposure to what bank interest rate can do to one. Perhaps that the reason why i can constraint my spending habits much lesser than most of my peers.
Delayed gratifications. Now that's something not easy for the Y generation.
Work hard, save hard, invest wisely. Sounds easy.. But in reality, most pol couldn't differentiate needs and wants most of time.
Cheers.
Your post resonates with me as I have a young child who is barely 2 years old.
Yes, as what some forumers have mentioned within this thread, the expenses incurred are not just monetary but also in terms of time and effort as well, as one must really devote a lot of personal time to caring for their child. There is simply no substitute for being physically there to interact with your child, play with him/her and share his/her joy and laughter. It's really a kind of joy which is hard to describe until you experience it, which is why parenthood is such a pleasure for some, and a pain for others (loss of freedom).
I actually spoke to a financial planner who told me I probably need about S$300,000 by the time my daughter is ready for University at the age of 18. Since I don't really believe in the returns provided by an endowment plan, what I did buy for her was a life insurance policy which will cover her till she is 18 and then the premiums will stop. In the meantime, I will be saving up for her education through investing my own funds and using my own savings, since I know CPF is almost untouchable.
And yes, on the topic of spending habits, I think as a parent we must really learn to inhibit our spending urges and instead learn to save more money for a rainy day and for our child(ren). Delayed gratification is somewhat a dirty phrase which is not recognized by the current generation anymore, seeing how many teenagers dine in restaurants, own iPhones and Blackberrys and talk about material goods and consumerism even before they start earning their own keep. It's correct to say that Generation Y is even less frugal (in general) than Generation X, and Generation Z will probably be even more pampered by the "paper" wealth which has been accumulated by their parents.
I think it's not always the problem of not being able to differentiate needs from wants. I have spoken to friends and the problem lies in not being able to control the urge to procure those wants, and giving themselves up to indulgence and a "live for the moment" attitude. In other words, self-control is sorely lacking in today's society and youth.