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How to raise money-smart kids?

Materialism and money management

Endorsement of materialistic values can have an impact on our financial decisions. In several of our studies, we asked the respondent to allocate $100 of windfall into three possible uses: (a) money to buy things (b) money for saving, and (c) money to donate to charity organizations.

The mean allocation of $100 was as follows:

Spending
Saving
Donating

Regression Line Chart

In the below diagram, there are three regression lines. Each line represents the result of one regression analysis. The predicted variable was the mean amount allocated to either spending, saving, or donating. The predicting variable was the mean materialism score (scale 1 to 5).

Spending

Saving

Donating

The regression results can be summarized in the below table

Table Summary of three regression analysis for predicting spending, saving, and donating using materialistic value scores as a predictor (N = 1,559)

Variable B SE β β
Line 1 (spending)
materialism
11.63 0.89 0.31***
Line 2 (saving)
materialism
-8.21 0.87 -0.23***
Line 3 (donating)
materialism
-3.42 0.53 -0.16***

Note. R2 = 0.10 for spending; R2= 0.05 for saving; R2= 0.03 for donating; *** p < 0.001

Based on the regression lines, it was found that respondents’ materialism score was a significant predictor of how they would allocate the $100. Respondents with high materialistic value scores would spend more, save less, and donate less to charity organizations. The R square values were 0.10, 0.05, and 0.03 for a prediction of spending, saving, and donating respectively. The order of magnitudes of R square values indicates that materialistic value has a higher predictive power for spending, less for saving, and even less for donating.

Undesirable effects of materialism

  1. Excessive consumption and shopaholics

    Individuals who are materialistic have an urge to consume, even when basic necessities are met. They may have difficulties differentiating needs and wants. They want to prove that they are cool and successful by having lots of possessions, especially luxurious products or branded goods. Excessive consumption is the fundamental problem under materialism. To go to that extreme, they can become compulsive buyers. They cannot stop consuming even though they cannot afford the goods and repay the debts. They consume not because they need the products, but to fill their unlimited desire and sense of emptiness. Edwards (1992) defines compulsive buying as a chronic, abnormal form of spending characterized by a pattern of overpowering, uncontrollable, and repetitive urge to buy.

  2. Falling into the trap of debt

    Materialistic youths regard possessions as a source of happiness and a way to release stress. If they cannot afford to buy what they want, but buy it anyway using credit, they will easily incur a large amount of debt. If they cannot clear the debt every month, the debt will roll up in a exponential manner. They may need to borrow money from family members or friends to repay the debt. They may even go into bankruptcy.

    According to a social worker, the number of post-80’s and post-90’s generation people seeking help for debt has increased. A male student, with an associate degree, incurred a debt of HK$90,000 because of an overseas vacation trip with his girlfriend. According to Mr. Henry Chan, Supervisor of Tung Wah Group of Hospitals Healthy Budgeting Family Debt Counseling Centre, the youngest client they counselled for bankruptcy was only 22 years old.

  3. Tempted to get quick money

    Materialistic girls and boys may desire to gain quick money for designer clothes, bags and cosmetics. These teenagers might be tempted to practise compensated dating or become a Part-Time Girlfriend/Boyfriend (PTGF/PTBF) to earn easy money in order to fulfill their unlimited desire for possessions.

    They might also be tempted by illegal activities such as drug selling or drug trafficking.


Edwards, E.A. (1992). The measurement and modeling of compulsive buying behavior. Dissertation Abstracts International, 53(11-A), UM9308304.

物質主義的不良影響

  1. 過度消費與購物狂的形成

    崇尚物質主義的年輕人都擁有強烈的購物慾,他們難以區分“需要”和“想要”,一心希望透過擁有的物質尤其是名牌產品,來表達自己的時尚與成功。過度消費是物質主義的根本問題,更甚者會養成強迫性購物的習慣。即使負擔不起消費及償還欠債,他們仍不能停止消費。學者Elizabeth Anne Edwards解釋,強迫性購物是一種習慣性的、不正常的消費模式,其特點是無法抵抗、無法自拔以及重複性。

  2. 陷入債務危機

    崇尚物質主義的年輕人視物質為快樂的源泉和減壓的渠道。當沒有足夠現金時,他們會以信用卡購物。當無法控制消費時,他們容易累積一大筆債務。若不能定期償還欠債,債務會越滾越大,最後他們需要家人或朋友的幫助,始能走出困境,債務嚴重者更會面臨破產。

    有社工指出,越來越多的80後、90後因債務問題向社工求助。其中一個例子是,一位大專男生以信用卡花費九萬元與女朋友往海外旅行。東華三院健康理財家庭輔導中心主任陳福龍先生指出,在曾接受破產諮詢的人士中,最年輕的只有22歲。

  3. 易受誘惑“賺快錢”

    為了滿足無限的購物慾和購買名牌設計師設計的產品,崇尚物質主義的年輕男女易產生“賺快錢”的念頭。他們容易受到誘惑參與援交,或成為出租男女友。有些甚至會參與違法行為,例如販賣或走私毒品。

Parents alert: Discuss consumption and money management with your child

Scenario 1

Daughter: “Mum, would you please buy me this bag for $8,000? All my best friends have it!”

Teach your children to differentiate between their needs and wants. Tell them it is not necessary to compare possessions with peers. Encourage them to buy things that are within their means and are able to reflect their own style.


Scenario 2

Son: “Mum, I don’t want these local brands. They are so cheap. I want luxurious branded goods! They are better. I don’t want my friends to look down at me.”

Tell your children that they are far more valuable than the things they own. Possessions are only one of the ways to express themselves. Their identity can be constructed from personality, hobbies, interest, and activities.


Scenario 3

Daughter: “Mum, I am very stressed out because of my examinations. Would you please give me $1,000 for shopping so that I can blow off some steam?”

Tell your children that spending cannot release anxiety and negative emotion. If they buy something just because of the bad feelings but do not really need it, they might feel guilty after that and may even become more upset. At the same time, you should encourage them to adopt alternative ways to release stress, such as hiking and doing sports with friends.


Scenario 4

Your son/daughter buys or owns things that far exceeds their means

Ask them how are they able to get those items. You should ask them to show you their credit card or bank statement. Help your children’s basic money management skills such as setting a budget for saving, keeping track of expenses, as well as balancing income and expenses.


Scenario 5

You discover that your son/daughter is struggling with debts.

Don’t blame them for the behavior but rather encourage them to search for help from professionals, financial consultants, or social workers. Let them know that they are responsible for their debt and you are there to support them. You may suggest to them to cut using credit cards for a period of time.


The Investor Education Centre developed a web site about money management for people at different life stages. You can find useful tips for parents there:
https://www.thechinfamily.hk/web/en/parent/index.html

父母的警惕:親子理財教育

情景一

女兒:“媽媽,可以給我8000元買這個名牌手袋嗎?我的好朋友們都已經買了!”

建議:教導您的孩子區分“需要”和“想要”,告訴他們毋須和朋友攀比,並鼓勵他們購買合理價格以及能反映個人風格的物品。


情景二

兒子:“媽媽,我不想要這些雜牌的商品,他們太廉價了。我想要名牌的產品,名牌的東西比較優質。我不想讓朋友們瞧不起我。”

建議:告訴您的孩子他們的價值遠遠超過物質的本身,物質並非反映他們價值的唯一方法。他們的身份也能藉個性、愛好、興趣以及活動來呈現。


情景三

女兒:“媽媽,快到期末考試了,我壓力非常大,可以給我1000元去購物減壓嗎?”

建議:告訴您的孩子消費並不能減壓或消除負面情緒。如果他們僅僅是為了緩解情緒而購買一些非必需品,過後他們會因為亂買東西而後悔或內疚,變得更加消極。您應該鼓勵他們通過另一些方法去減壓,例如遠足、做運動等。


情景四

您的子女購買一些價格不菲的物品,價格遠遠超過他們能承受的範圍。

建議:關心他們如何得到那些昂貴物品,查看他們的信用卡或者銀行賬單。教育您的孩子基本的理財技巧,例如制定儲蓄計劃,記錄每日消費,維持收支平衡。


情景五

您發現子女陷入債務問題。

建議:先不要責怪他們,而應該鼓勵他們尋求專業人士、理財顧問或者社工的幫助。這樣讓他們知道自己需要為債務負上責任,知道父母也在支持他們。您也可以建議他們停止使用信用卡一段時間。


香港政府成立的投資者教育中心,建立了一個有關理財的網站“錢家有道”,提供親子理財的資訊及提示,協助父母讓子女可以輕鬆又愉快地學習理財。您可以從中查詢各種資訊:
https://www.thechinfamily.hk/web/tc/