“Kids these days feel so entitled,” said my childhood friend. “Remember the good old days when we never asked our parents for anything?” she added, as we sipped a cup of coffee and started reminiscing about our childhood in India.
My friend grew up poor in India. She shared a 10′ x10′ thatched hut with her mother, sister, brother and grandparents. She saw her father only once a week when he showed up drunk to beat up her mother for more alcohol money. The women slept inside on the unfinished dirt floor, while the men slept outside. The hut would collapse every monsoon season and flood with water up to hip level. They would camp in empty marriage halls or temples during that time. They never had electricity. Homework and studying were done by street light.
Everything from uniforms, textbooks and notebooks were acquired for free or secondhand. She walked five kilometers one way to school, without any shoes, as they were not affordable. She started working at 13, tutoring other kids. She got new clothes once a year when politicians gave away stuff for votes.
There were no food stamps, libraries, Internet, cable, TV, phones, beds or running water.
I have had a cushy life compared to hers. I enjoyed a blessed middle-class life. Both my parents were educated and employed. So, by no stretch can I say I struggled, even though my parents, grandparents, sister and I lived in a one-bedroom house where we slept on the floor and had trouble getting water six months out of the year. We didn't have air conditioning, a washing machine, a dishwasher or any luxuries, but were never deprived of any necessities either. We got a phone line when I was in the final year of high school. I biked five kilometers one way to school, and to this day my parents get around everywhere using public transportation.
Twenty years later, there we were, sitting in her comfortable porch overlooking a small garden, in a suburb of a major city in India. She is now a successful physiotherapist, happily married, with two adorable kids, leading a comfortable middle-class life. I am an immigrant to the U.S., earning an above-average living.
“We did alright,” she concluded. “I just wish I could find a good way to impress upon my kids that life is not always flowing with milk and honey.”
I don't have kids, but that comment stuck with me. I have been asked to write about frugality lessons from India in my blog. I have at least seven or eight draft posts that touch upon this subject, but I never hit publish on any of those. I'm unable to convince myself that these tips will help anyone. Why? Plenty of reasons. To name a few:
- Yes, we were frugal but that was a necessity, not a choice. The problem is, when extreme frugality is not a necessity, it becomes difficult to hold on to it. My grandparents paid for their house in cash because there was no concept of a home mortgage. Consequently, their house was very small. My parents took a small loan from their workplace to buy a house and their house was a little bigger. Now my friends have taken mortgages for 90 percent of the value of their palatial houses. When our society changes, we change with it. A simple tip of “buy your home with cash” won't help anyone if they already don't have the mind-set.
- Different environment, different culture, different priorities. I have read more than one post recommending that people should make their own clothes. In India it made sense because the materials and labor were cheap. Anyone in the U.S. who has tried knitting as a hobby knows how expensive it is. And unless I want to do it, why would I want to waste three to four hours of my time making a dress for my little girl when I can buy cute outfits for a couple of dollars?
- Some frugality tips cross over to being cheap. Sometimes, I have seen people do things that are unethical, if not downright illegal, in the name of frugality. One of the shortcomings of developing countries is that a lot of them are corrupt and, unfortunately, some people bring that attitude with them.
So what can I teach my kids who will grow up in a comfortable middle-class society in a developed country? I can't give them frugality tips; it just won't stick. Does that mean I have nothing to pass on to the next generation when it comes to money? That doesn't seem right. It was one of those questions I decided that I will automatically get the answer to when the time comes and I moved on.
So what will I teach my kids?
Just to make it clear I am not giving parenting advice — I'm not qualified to do that. Rather, this post is about what I would like to teach my kids when I become a parent.
I am in the fortunate position of having been brought up in humble surroundings and now working in a developed country, leading a comfortable life. I want to give my children the comforts I can afford, but at the same time I want them to appreciate how blessed they are to get them.
I will teach them…
- There are plenty of people who have it worse than you. Appreciate what you have and focus on taking advantage of that. Be thankful for that instead of focusing on what you don't have.
- Shed the sense of entitlement. The Indian system is competitive. If you want something you have to work for it (minus the caste system, but I am talking in general). There are no food banks, unemployment benefits, Medicare or Social Security.
- Take responsibility. I feel responsible for my parents' retirement, my kids' education and my own retirement. Growing up in India has taught me to believe that no one cares about my money more than I do. So saving comes naturally to me.
- Get priorities in order. Realize what is important in your life and figure out if you have the means to provide for it. If not, eliminate or minimize what you spend on things that are NOT important to you. Everything else will automatically fall into place.
- Help others as much as you can. You don't need money for this. At least in developed countries, most of the time, people who are struggling to come out of poverty have access to need-based aid or government assistance. What they lack is a mentor or someone to guide them along the right path and tell them where to look for things they need for the future. They need someone to show them there is a world full of opportunities waiting for them, and give them the hope and confidence they need to get out of poverty.
- Contribute to and take advantage of your social capital. The family system in India is very strong. Now, more families are becoming nuclear, but that doesn't stop them from relying on each other. Grandparents babysit the grandkids, some uncle or second cousin who is a plumber will spare a few minutes to give an honest opinion, an extended family member would happily provide meals for a few days when you are sick. Even in the U.S., immigrant communities are some of the most closely knit communities. Offer help and use your network to find help.
- There are plenty of non-material ways to feel rich. I feel rich when I can spend time with my family. My mother's home cooking is worth more than the world's most expensive restaurant meal to me.
- Be resourceful. I won't teach them to make their own clothes or grow their own food just for the sake of saving money. I will teach them how to do all those things and be resourceful because they are good skills to have.
- And finally, I would teach them to never stop learning. Both the developed and developing countries have their own strengths and weaknesses. Wherever life takes you, if you think their way is better and don't see other cultures and practices with an open mind, you will never grow.
When it comes down to it, most people already know quite a few frugality tips. Whether or not you want to actually practice what you know is what makes the difference.
Why be frugal? Is it to get out of debt? Amass a big bank balance? Or is it to appreciate and conserve what is available to us in the best possible way in order to achieve fulfillment in life? Ultimately, I want my children to be good citizens of the world. They won't learn that by memorizing tips but by imbibing the right principles which they can apply to any situation. By living my life according to the principles I've outlined above, I hope to teach them by example, on how to evaluate what goals are important in their life and how they can achieve them.
Author: Suba Iyer
Suba Iyer is a blogger by trade and a personal finance geek at heart. After living from paycheck to paycheck in spite of her above-average income, she figured money is not just about math. It involves human psychology, application of knowledge to individual situations and having all the right information. She now dedicates most of her time to writing about intelligently leveraging knowledge, time and money at Wealth Informatics. When she is not writing, you can catch her in her garage working on wooden toys for her daughter.
Well, I’d like to teach children that we are frugal today so that tomorrow maybe we can splurge a bit.
Frugality also means freedom. Money in the bank will allow you to make different decisions, gives you freedom of choice. Allows you to turn your back on that awful job or invest time in education. Or perhaps travel the world (and check out where your roots are!).
Besides: being in debt all the time puts you in financial shackles and all children should learn at least that!
And teach them charity. Even at a young age they may assist the elderly neighbor by weeding her garden or mowing her lawn.
That’s what I’ve learned and what I’d like to give to the next generation.
Being frugal usually is ethical, for both people and planet. Those cheap outfits you mention were made by people overseas – often children – who are basically being exploited. They were made using fabric full of toxic chemicals, and dyes full of heavy metals.
I have started buying organic/”green” fair trade clothing. While it is much more expensive than what you find in stores, I consider it the more frugal choice because it forces me to live with fewer pieces of clothing, causes me to choose the best-made and healthiest clothing available, and has enabled someone – whether in the US or overseas – to make a fair living wage for their labor.
We try to buy our son’s clothes from consignment sales and stores. I read somewhere that by the time the item made it to the store it had usually been wash enough to remove the chemicals from processing. Every once in a while I will buy something organic or handcrafted/silk screened, but rarely and those always go in the save for the next kid pile. He just grows to fast to spend money on clothes.
I feel the same about toys – got him a toy plane at a yard sale that was $1 that is one of his favorite toys. It’s missing half a wing and parts and no longer lights up, but it was otherwise destined for the dump.
I’m guessing your son is still a toddler.
At some point as he becomes more social he may become “that kid”
Having been that kid, please consider your purchases carefully. You don’t have to go out and buy the latest and greatest, but you should start checking that toys are complete.
It’s embarrassing when you first realize that your parents can’t (or in my case wouldn’t) buy decent stuff.
And it gives frugality a negative connotation, one your child may spend his adult life fighting by doing the exact opposite.
As a young adult I have to say I am really thankful to my parents to have taught me frugality. It is not only a question of need, it’s more a lifestyle. I don’t have a big income and am still hughly dependent on my parents on the finance side. Luckily I don’t have debts, having the luck to live in a country were education is practically for free. With this setting I consider myself having enough money to live at ease and without having to worry about not having enough money to get food at the end of the month.
If I’m in that situation now, it’s mainly because my parents taught me from early on to handle my own money, because they encouraged me to take up holiday jobs as soon as I could, so building up savings from you on, and because they also taught me to live frugally.
Comparing myself today (23, student) with other people having the same amount of money at their disposal, but always struggle with having not enough, I am really thankful that my parents taught me all this.
Great post Suba. I hope to show my future kids many different situations, maybe around the world, so they can realize their luck. I hope they can value money enough to preserve it and use it wisely, but can be able to spend on themselves and what is important to them, as well as give back generously. I hope they learn how to minimize waste, be it food, money, time… and know the value of things to make the best and longest use of any resource.
But seriously, is it even *possible* to red the first comment in the mobile view?
Thanks for saying something about this. I was beginning to think it was just me. Ever since they started putting that advertisement under the first comment (seen on computer), it has been inaccessible on mobile view.
I hope to teach my children to distinguish between a sense of entitlement for goods and the provision of social services for people who need them, which are an important part of supporting our fellow community members (and which all of us, no matter how hard-working, may one day need!).
Aside from teaching my children to be careful with money, I hope to teach them that the value of a person has nothing to do with the amount of money he/she has. I don’t want them to ever admire someone for being rich; rather, I hope their admiration of others stems from the values those people hold.
If I can do that in some way, I’ll be happy.
“Or is it to appreciate and conserve what is available to us in the best possible way in order to achieve fulfillment in life?”
That sums it up for me 🙂 I hope to teach the youngsters in my life that being frugal means being a good steward of the resources and blessings we receive/earn. Save where you can, reduce waste and spend in a way that reflects your needs and values.
Now if only it was that simple… 😉
I think the best lesson on frugality I got from my family comes from the fact that we are huge proponents of what we call “redneck ingenuity” – when you’re poor and/or you live in the middle of nowhere, you can’t just go buy a new Whatever when something breaks. You better be able to fix it yourself, or if you can’t fix it, you make something else out of it.
Not only does this save you money, but it provides you with a really valuable skill set. The ability to MacGyver something out of anything is deeply satisfying for everyone in my family and it’s a value I want to pass along to everyone I know. Understanding how things work and how to use them gives you a lot of appreciation for the things you have.
In other words, frugality isn’t just about not spending money. It seems like what most people spend money on is convenience – they pay for something they don’t have the skills to do themselves. So when you don’t want to take advantage of that convenience, you’re not only saving money, you’re also forcing yourself to learn skills that might prove useful down the line.
So “why”? Because, at least in my family, frugality is closely tied to other values, like independence and the ability to take care of each other. Planning for the future, having some money to spare, knowing how to fix things yourself for free or cheap…these are all skills that are deeply entwined for me and have (I believe) made me much better prepared for whatever happens next.
So they don’t make the same mistakes Id id with my money!
I love this article. Here in the US, myself included, we think our lives are normal, and the others are poor. I don’t think that we’ll ever understand how our parents and grandparents lived, let alone the rest of the world. I got video games on Christmas morning. My grandfather got an apple, once (and not the computer!) which is why he remembers that Christmas.
“Extreme frugality” in the US means cutting cable, ditching the cell phone, and shopping at thrift stores.
When I save money by staying in on the weekends instead of going to dinner or a bar with friends, I feel as though I am making a big sacrifice. When I make this “big sacrifice,” I’m usually watching an HDTV, browsing around on my MacBook Pro, on my big comfy bed, in my own bedroom….
My parents often try to give me money, but I’ve been refusing for quite a while, especially after reading The Millionaire Next Door after hearing about it here on GRS from JD. Accepting their money will incentivize me to spend more than I earn. Plus, my brothers and I are going to inherit that money someday, so I’m basically spending my own money anyway.
The US, and much of the developed world, will be forced into frugality once interest rates rise, but I digress…
I think Matt is right in his assesment on United States lifestyle inflation post WWII. My paternal grandparents lost a farm in the Great Depression and my maternal grandparents were just trying to get started in life while the world was in chaos. Of course my parents were raised in a frugal world by sheer need at the time, and were probably lower/middle class economicly. All of their teaching has distilled down to me and now I’m trying to pass it on to my daughter. Hopefully she will be smart and frugal with money and be resourcefull in her every day living.
Although i grew up in an affluent family, I was brought up poor. I got what I needed vs. what I wanted. Money was spent on education, but little else. My children were brought up similarly. My parents taught me values. Unfortunately, I did not spend as much time with them as I would have liked. We in turn spent a lot of time with our children to teach them values. Children learn from parents actions vs. what they may say.
great post!
best guest post I’ve read yet. Thank you!
I simply have never read a better article on a financial website. Suba, you teach much and there are statements in your writing which I hope you explore and expand. Your young life and the life of your friend are examples for all of us who have grown up with so much. We can survive without government entitlements aimed at the rich and some aimed at the poor which mainly enriches the bureaucratic givers rather than the poor.
Please write more, Suba. You have wisdom beyond your years.
What a wonderful article Suba!
I am now writing about frugality for my children who are both young adults. My 21 year old daughter is smart about managing her money while her 25 year old brother isn’t.
They didn’t learn about frugal living during their upbringing because I didn’t know much myself. Our family’s income was very good and I was far too busy with our businesses to worry about how much we were spending.
When I divorced after 30 years of marriage, my financial situation changed and I had to learn how to manage the money I had. Now I have remarried to a financially savvy tightwad and I have changed my own spending habits to reflect our frugal lifestyle.
It is much harder to teach your children about handling money when they have become adults, so start early by setting a great example and explaining about financial decision making.
Excellent post. Thank you.
I think number 1 on your list is key. My boys are only 2 and 4 right now, but as they get older I really want to strive to find ways for them to realize just how good they have it. We don’t take vacations to Disney or wear name brand clothes, but we have never once had to worry about not having something to eat for dinner. We will be volunteering at the homeless shelter and things like that, but I would love to hear some ideas on how to show our kids how good they have it.
Take the kids on a trip to India!
My family didn’t teach me frugality, they showed me, so I don’t even know if it’s something you can teach to be honest.
You can teach them but you can’t make them learn. My parents taught me to be frugal and I thought I taught mine. Of my two only one learned the lesson. The other drives me crazy.
Good article, but I’d like to know more about your friend and how she went from a thatched hut to a physiotherapist in Indian suburbia.
I think my friends taught me frugality. My parents grew up in Asia, so all their stories of hardship seemed so distant to me.
I don’t think I really realized the truth of most of my friends until I was around 22. I noticed most of my friends with the flashiest items were barely getting by with savings. They literally worked with the intention to buy things without investing in true things of value: such as their retirement, education, or house. I realized most of them were going to spend themselves in to the ground with only purses or a nice car to accompany them
I then noticed that my most “successful” friends were actually the most thrifty. They were pharmacists, had MBAs or other distinctions yet they’d carefully plan all of their living expenses. I think it was then that I realized that material wealth meant very little about a person.
Yes your stories how you got from one situation to the current situation would be interesting and informative!
Oh, excellent post, Suba. Very well written and I think you found the most appropriate way to convey the imposed frugality in India. I have read posts in this vein before and they have ended up on a wrong note. Yours was perfect. Thanks!
Suba, your post is why I LOVE immigrants and why I love that ambitious immigrants do so well in the US (you’ve earned it!). If you have kids someday I guarantee they will learn your lessons and be super successful.
I’m a teacher and would gladly take a class of immigrants’ kids over Americans’ kids. Sure, there are plenty of wonderful American kids, but on average, the drive and humility of self-made immigrants lasts a few generations. No violent tantrums that they didn’t get an Apple or an A without effort…the list goes on…
Great discussion on frugality. I too grew up in India and have seen poverty firsthand. I’d like to teach my children about frugality because it is a good lesson for them to keep their eye on long-term goals. Frugality forces you to make choices on getting something now vs. later.
I can’t speak for others, but for myself I want two things for my kids once they are adults.
1) they enjoy their lives
2) on their dime, not mine
Pretty much all I teach and discuss with them with respect to money matters is with that in mind.
Thanks a lot for publishing my guest post, Ellen and thanks everyone for the great discussion!!
For those of you asking for more on how my friend got to where she is now, I will happily write a follow up.
I realize I cannot really “teach” my kids anything, it has to come from how and what we do with our money. I don’t think it will be a easy task by any means. Hopefully by living what we would like to teach we can make a good example for them to follow.
I teach my kids frugality because frugality can help you to be secure in life. I mostly grew up poor by U.S. standards and we’re not too far removed from being working poor now. Social mobility is not great in the U.S. so it’s not outside the realm of possibility that my kids will stay in a similar income level.
Being careful with your money, planning ahead, avoiding debt, and avoiding addictions, especially to tobacco, can help you live more comfortably on a small income.
I am frugal now because I had to be to get out of debt I piled up when I was younger and foolish. I want my kids to be frugal so they won’t have to live like paupers to pay off debt, so they can enjoy their lives and have the peace of mind that comes with being debt free.
A Well written Article Suba. Things have changed a lot in India now on poverty front, however still lot needs to be done before we reattain the glory of pre-imperialism days.
Nice Post.
I believe in the saying that ‘The more bigger and taller a tree, the more deeper are its roots’.
“the glory of pre imperialism days” ???
Seriously?
I have taught my kids to be conscious of the value of money – how it’s made and how it’s wisely spent.
Ivan Illich wrote: “In a consumer society, there are inevitably two kinds of slaves: the prisoners of addiction and the prisoners of envy.” I don’t want my kids to be slaves.
For my oldest child’s generation at least, there seems to be less addiction to stuff-itis as there is to experience-itis. It seems to be a facebook-envy thing.
a good article…more what I was expecting from this site
What a great post. I think one of the best things to do with children to teach them the value of money and frugality to to take them places like India or other countries where things are so different from the privileged life we have here in North America. Travel can do a lot of good for children (if they are old enough to understand).
Great article!
I remember Liz Taylor saying:
“You don’t have to be a millionaire to go and serve food to people in need, you don’t have to be a millionaire to do what you can to help others!”
I think she was a geat sample of what we all need, more humanity and to be thankful ad know that we are already rich.
I enjoyed the article, however, I have to say this…if you have frugal skills, no matter what happens you will always be secure. We live in a strange economy. There is no guarantee that the kids of comfortably middle class parents will grow up to be the same (see the numbers of unemployed college graduates). We live in an economy where anything can happen to anyone, and often does. Those frugal skills foster independence and creativity.
As far as the do it yourself versus buying it thing…well, I can promise you that a knit scarf I make myself is better quality than the five buck one at Target or Walmart. And I can make it in any shade I want, at any length, rather than relying on what happens to be available in the store on any given day.
I have to agree about quality. If I want to buy something that is as unique and well-made as what I can crochet (hopefully one day I’ll learn to knit), then I’d have to spend quite the bundle to get it and it won’t be available at Target.
I read this article right before going to a family dinner this weekend. At the dinner, my sister-in-law alternated between A) complaining about the timing/inadequacy of food stamps, not being able to qualify for other welfare, and being so broke she couldn’t afford the drive to visit family, like, ever, but we could feel free to come pick her up and take her to dinner whenever we wanted…and B) bragging about her brand new car, new living room furniture in her new apartment (and all her plans to decorate it a’la Style magazine), new Samsung Galaxy S-Whatever, new I-pod, etc. After a couple rounds of this, I made a couple tactful remarks about the hypocrisy of the situation, which was met with more complaining about the unfairness of life (apparently I was so tactful she thought I was on her side). I kept thinking about this article, and could hardly believe that she could really think she has a rough life. I will teach my kids about frugality and all it entails so they are never so ignorant.
I love your article…first one I read in the new year and it really struck a chord. The lessons you will teach your children are priceless and the reasons given for for being resourceful and enjoying life in non-material ways especially hit home with me. Time with friends and family and doing one’s best to understand other’s viewpoints rather than insisting on one’s own, go a long way in making the world a better place.
Our family spent most of our children’s lives overseas due to work. We have seen and experienced first hand poverty, not to the degree which you describe, but a world away from what family members in the US experienced. Our sons are now grown and making their own way in life, but have often commented how grateful they are for the close family bonds we have. Recently one commented that while they did not have the latest gadgets while growing up, they always had what they needed and they never felt deprived.
Please keep sharing posts like this.
I am grateful my parents taught me to live frugal but to dream big. Growing up I never felt rich. My parents would always say that “its not going to be a very big Christmas this year.” Secretly my dad was very wealthy. He invested his money in rental properties and other things. My parents helped me find ways to make my own money to buy my own things. I learned so much from that. I feel that even if you are rich you shouldn’t live rich and give your kids whatever they want. Growing up this way gave me the desire to make it big on my own. Thanks, Mom and Dad