Child Money Investment Policies

The best gift a parent can give his/her child is the gift of literacy! In this article, however, I am going to talk about something that is not taught in most schools across the world -- financial literacy.

Let me begin with an example. We stay in Mumbai. The other day, I asked my daughter Reet where she wanted to go. "Shopping" she said. "Crossword," she added. On further questioning, I realised she wanted to go shopping at Infinity Mall in suburban Mumbai and then go to Crossword to read books.

Later, I realised why she had responded in this manner -- the mall, after all, was where we went most often. I talked to several other parents and they said the same thing -- the mall was where they headed for with their families on most weekends. Ask yourself where you spend most of your time with your kids and I bet you will see where I am coming from.

We are living in a period of unprecedented economic prosperity where many of us are becoming more and more prosperous. This prosperity also brings with it a tendency to spend and make financial decisions that may not be in one's best interests.

Financial literacy means understanding:

~ Income, expenses and savings
~ Budgeting
~ Assets -- real and financial -- and liabilities
~ Insurance and its purpose
~ Investments and how to make money work for you
~ Taxation
~ Risk management, asset protection
~ How to handle situations such as disability, divorce, starting a business, inheritance
~ Wills, trusts, intergenerational wealth transfer Child Money Investment Policies