Last week my husband read something about research that concluded that rich parents giving their kids money actually limited their ability to achieve in life. We’re talking lots of money of course, and just lavishing it on them, without making them earn it or learn the value of it, but it got us thinking about our children’s saving needs.
It made me remember Maslow’s hierarchy of needs, needs he argued, start with the base of the triangle, once you have met the bottom layer, you can move up.
My husband’s inheritance from his grandfather paid for the deposit on out first flat. It gave us a really solid foundation in adult life. We often wonder if things would have worked out very differently had we had to work harder to save for that. Would we value our house more, would we have made more sensible decisions about money, would we have developed better saving habits in general, or even viewed our home differently?
I hope my children learn to spend wisely. When they were small we started to save for their future, there have been big gaps, savings rates have been variable, but that money is slowly creeping up.
My husband’s grandfather was a teacher and a wise man, he made it very clear in his will at what age my husband was to inherit the final and largest sum of money, 27 was the age he deemed old enough to do something sensible with it. I think he was probably right.
I think he knew that it would be the right time to settle down and buy a house, as we hit our late twenties that’s where we were heading. I think about Maslow’s hierarchy of needs a lot, I think that having that base allowed us to focus on moving up the the triangle to focus on relationships, happiness, self esteem and dare I say it, reaching out for self actualisation.
But I also think about the amazing time I had at university – psychologists say 17 is the age at which you begin to develop your preferences in life – I think it is a critical time and one I go back to in my head a lot when I lose track of my true self. Who was I then and what did I want in life?
So I hope my children have enough money to spend on a period of developing themselves, whether that’s university, a gap year or other kinds of work experience or training. Something that gives them the tools to self actualise, to become who they are meant to be, to find themselves and to be happy.
Then I wonder if perhaps starting at the bottom of what Maslow called the ‘hierarchy of needs’ is equally important, by building shelter. And I am back to square one. I guess as parents you are trying to cover as many bits of the triangle as you can, while teaching your child to think, spend wisely and to save, for themselves.
I should also throw in at this point, how I spent the savings I inherited from my own grandmothers. Both were small amounts, but with the savings past to me from my maternal Gran I bought my first computer, which as a trainee teacher was an essential piece of kit and development for that career, and for the work I do today. At this point my parents were still very much funding the bottom of the triangle.
My paternal Grandmother died when I was in my 30s, and her savings went towards our camper van, which we eventually traded in for a caravan – both of which I would argue cover all of Maslow’s hierarchy of needs. From shelter, to freedom from the fear of be driven mad in suburbia, to a feeling of belonging as a family, to the self esteem of mastering new skills to the huge sense of fulfilment travel, and being in nature provides. I think that was a rather amazing way to use our savings, I feel fortunate we could make that investment.
I guess the main thing is to save, to future proof our children’s tomorrow, because university and houses are becoming more and more expensive, and because you never know what journeys they will want to go on. We still have a good ten years to fathom it out before the oldest hits 18, although the last 8 flew by. At the moment we’re working on teaching them the value of money with pocket money and trying to put a bit away for their future.
Do you have any words of wisdom on children’s saving needs? What are you saving for?