“The only wealth in this world is children, more than all the money power on earth” – Mario Puzo

I agree with Mario Puzo. Children are such a blessing. Our political leaders don’t tire ever repeating that Children are nation’s biggest asset. Future wealth of the nation depends upon their success.

However, while children can be asset for a nation at macro level, they can be a financial drain for family at micro level. This is true especially from the perspectives of parents who give precedence to career enhancement of their kids, over their own financial security during retirement.

Having children makes our life enriched in many ways. However, the plain truth is that generally they don’t make us richer. On the contrary, most parents would compromise their life savings in meeting the financial demands of their children. According to Merrill Lynch survey, close to 75% of American parents give more importance to children education over their own retirement planning. That’s even more true in India. We see more Child Insurance policies getting bought in comparison to Retirement Plans.

Unfortunately, this is not a great idea. A child when grows up will have the option to raise education money through education loan. Whereas, if you retire broke, no one lend you a penny.

Depending on your financial circumstances, where you may not be able to support abnormally high education fees, it is wise to collect resources from other means. So, you may ask grand parents, and relatives to give occasional gifts directly into child’s bank account. From there this money can go into mutual funds in the name of child, and accumulate into bigger amount for future.

Children should also be taught frugality and importance of money from the very beginning.  Earlier the lessons taught, better it is. Don’t wait for any outside mentor to tell your kids about this. You have to be that mentor.

Children should be taught to save in piggy bank. They should be taken to bank or your financial advisor’s office, where they can see how money works. Concepts of inflation needs to be ingrained in their little mind. Teaching them how compounding works is perhaps the biggest lesson of all.

You shouldn’t be rude in declining any financial support when they have grown up. You may set a limit to which you can contribute. Rest, they will have to manage. Trust me, they will appreciate your gesture which will benefit in the long run. This way you are making them go through the grind of borrowing, earning, and repaying. This will enhance their ability to plan their finances in future as well. Success doesn’t come on platter. Even finance should not !!

Have safe withdrawal limit. Have safe and happy retirement !!


By Sameer Rastogi

18 years of experience, PG in Finance and has delivered Wealth Management lectures at IIM Lucknow, IBS Gurgaon and IIPM Delhi. Contributed to various newspapers. Strength – Application of Economic fundamentals to Investment

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