Lessons to save, to share and to give your children

On the money: As it's the holy month of Ramadan, I'd like to focus for a bit on the acts of giving and sharing. Research suggests that what matters most is not how much money we have but rather what we do with it.

Every Friday I give my six-year-old son, Keanan, six Dh1 coins, and we take out his three money boxes: a cow, a dinosaur and a house, and he decides how much to put in each.
One is for saving money; he wants to go to Sri Lanka. Another is for spending; he wants to buy books and toys. The third is for giving: he is going to give the money to a charity he is familiar with.
So far, he's put the bulk in the giving box, every time. I wonder how this will change as he becomes more tuned into what money can do for him … Personally, I hope he will always abide by the three S's: spend, share and save. The ratio will definitely change depending on which phase of life he's in, but the important thing is that he does all three, regardless of how much money he has.
As it's the holy month of Ramadan, I'd like to focus for a bit on the acts of giving and sharing. Research suggests that what matters most is not how much money we have but rather what we do with it. And it turns out that spending money on others can boost our own happiness. The findings of these studies are not definitive, partly because they rely on "self reports" of happiness, and those are not always reliable. But there is a growing body of research that lends scientific credence to the adage that it is better to give than to receive.
This gives me renewed faith in human nature, and I sincerely hope that we all, whatever our faith, act upon the premise of Ramadan, which is remembering those less fortunate, as well as sharing what we have, and looking at what's really important in life: time spent with loved ones as well as stepping out of the rat race and looking inside ourselves, reconnecting with a more spiritual, or at least less self-centred, approach to living than our usual hectic daily routine allows.
What better way to teach our children these values than through our own actions?
But back to instilling money values in our young ones: it can be an emotional journey. I've been to quite a few parental think tanks that have focused on children and money. The discussions included issues like at what age should children get pocket money; what, if anything, should it be tied to; if you don't do your chores, do you get your money?
And it has been quite an experience, with parents getting worked up while sharing stories of their children's behaviour, values, choices and so on. The overriding issues include:
Living in the UAE isn't the same as living in the "real world". It seems to me that the parent is projecting what he or she grew up with and comparing it with what their children have and do. The parent might have had to fork out on a bus fare, stand for an age waiting for said bus, save up for a magazine, or similar, whereas here, children are ferried around, oblivious to what things cost, and perhaps have a demand-based, instant gratification relationship with their parents and money.
Peer pressure is immense. Parents feel either bullied into satisfying their children's "needs" (read demands and expectations) or are engulfed by guilt if they say no.
So really, it looks like a lot of this is about the parents. Their guilt, their emotional conflict of wanting to provide for and make their offspring happy, tugging against that niggling feeling that what they're doing, should they cave, is not going to serve their children in the longer run; they won't know how to handle money when they leave home, and might need handouts from mummy and daddy for years to come.
My website, cashy.me, had a university student write a blog where she said she lived as a princess at the start of every month, and a pauper at the end, because she simply didn't know how to handle money or budget. She was born and bred in the UAE and was at a London university. She's not alone.
One way of avoiding this happening later in life is through giving your young child pocket money and making them responsible for it.
I believe pocket money should be given unconditionally, meaning not as a reward or for it to be used as a form of discipline or punishment if the child doesn't do his or her chores. I believe they should know the rules - what they're not allowed to spend on, for example - but not micromanaged.
Children need to make their own decisions. If your child wants a toy similar to one they already have, so be it.
The way to learn is for them to be empowered to make a decision and live with the consequences; you can either buy an ice cream or a stuffed bunny. The ice cream will finish and be gone forever, but you can play with the bunny for a long time. You decide.
And then really do let them decide. And enjoy their decision.
They might make rash decisions, regret things, go for instant gratification, but they will work it out if you enable them and trust them enough to. We learn from our mistakes and so children need to be left to make their own errors, and then not be subjected to "I told you so", but rather a chat about their choices.
And while you're at it, please do have them fill their save, spend and share pots each time they handle their own money. It'll make for a happier person and a happier, more inclusive, caring world.
Nima Abu Wardeh is the founder of the personal finance website www.cashy.me. You can contact her at [e-mail]