Former Wall Street trader sets up centre to teach kids the value of money
A former Wall Street trader hasset up a learning centre that teaches youngsters to appreciate the value of money, writes Elaine Yau
Since her eldest daughter Vedika turned four this year, Anuja Agarwal has started teaching her how to manage money by using various games.
"I give her fake money and a piggybank. We discuss what she would like to do with the money," Agarwal says. "When her friend has a birthday party, I will ask her to choose the gift within a fixed budget. It's a good idea to give children a sense of how much the gift costs. This will give them a sense of how money works in the real world."
A former banker, Agarwal believes in instilling good money-managing habits early and wants to nurture positive attitudes in her little girl through their everyday activities.
"While preschool children are too young to understand such concepts as insurance and financial goals, we can talk to them in terms of games. Kids have good absorption capacity. Research shows that habits built at this age can persist and last a lifetime," she says.
Agarwal came to Hong Kong for a banking job 10 years ago and quit working full time after giving birth to Vedika in 2011. Instead of settling into domesticity, however, she has leveraged her professional expertise into a sideline by setting up Pinnacle Learning Centre, which teaches financial literacy to children aged from four to 14.
"I worked for big Wall Street banks for seven to eight years, focused on equity markets from the trading floor, and I quite liked it. But after having kids, I want to do more exciting things," she says.
Setting up the centre combines her fondness for children with her background in finance. "Our children are growing up in an affluent society with access to a lot more resources than most of us had. This makes it tough for them to appreciate the real value of the privileges they are growing up with," she says.
That's why parents should introduce ideas about financial responsibility to their children from an early age. "Vedika is studying in a Montessori preschool and she will go to the French International School. She is surrounded by children who are used to expensive things; some already have an iPhone or iPad and know how to download apps. They should learn to be money conscious, and not to take any of their privileges for granted."
"Whether you are planning their birthday parties or trips to amusement parks, make sure to discuss with them and decide on budgets before the real activity. Stick to the budgets and opt to skip some things to include new demands rather than [increase the budget]. This works out well to show children how to make each penny count."
Instead of operating out of her own premises, Agarwal partners with schools and non-governmental organisations to run classes and one-day workshops at different locations.
The Pinnacle Learning workshops are tailored according to the age group. Preschoolers, for instance, may start with a craft activity such as decorating a piggybank before being given play money to manage.
"We ask them to allocate it for three purposes: savings, charity or spending. We discuss with them the reasons for their allocation and why we should save," Agarwal says.
"For older kids, we have certificate courses lasting four to six weeks. I let them talk and there're lots of discussions. They discuss why banks don't print more money to distribute to the poor. Once they were given choice to think in a logical way, they know printing lots of money will only cause inflation."
To teach youngsters about exchange rates, Agarwal would ask where they went on their last holiday, how the local money compared with Hong Kong dollars, and engage them in games to match different currencies.
Another major component of the curriculum for older children focuses on entrepreneurship. Pinnacle Learning has launched a contest, where youngsters aged from eight to 14 can start small venture of their own, write business proposal, plan finances and submit it to an online platform.
"They need to work as individuals and execute the ideas on their own. It can be a car washing venture or babysitting business or bake sale for their building residents that has to be profitable. They should do research and think about how much money to invest and the number of customers they would like to get."
Budding entrepreneurs can pick up many concepts from these exercises, she says.
"They can understand what cash flow is and learn to be enterprising and independent. The world is no longer what it was 15 years ago. Whether the child becomes an artist or a lawyer in future, they need to think outside the box."
But for all classes children might take about financial literacy, Agarwal believes learning should be incorporated into daily family life.
"Parents can consider giving them a special allowance based on household chores or errands they can run for them. These could be simple but fun activities such as babysitting a younger sibling or helping in the kitchen or with groceries."
Activities that are a part of youngsters' normal schedule such as tidying up their own rooms or doing homework should be excluded. "Basically, this is something extra that they wouldn't do otherwise. This can teach the children the concept of earning money through work," Agarwal says.
Parents can also read papers or magazine articles together with the children, and select stories for discussion. "If a story talks about exchange rates, they can explain how each country uses a different currency. The next time the family goes on a holiday, they can put that knowledge into practice.
"If the story is about commodities, pick a crop like rice and explain how farmers grow rice, and then sell it in a market to earn a living."
Agarwal believes that children learn best when they have parents who act as good role models.
"This is not to say that they should live a life of austerity, but they should remember that their own money habits will rub off on their children," she says.
"If we want our children to grow into fiscally responsible adults, we should to be ready to walk the talk ourselves."