Jonathan Cattana : Financial Advisor Avestra
Jonathan Cattana : Financial Advisor Avestra
According to a new book, How to pay for private school fees (and still have money in the bank) by Jonathan Cattana, you could be spending $45,000 a year to send your child to a private school by 2017 — just 10 years away. Why so high? Over the past 15 years, school fees have increased at two-and-a-half times the inflation rate, largely to meet the higher building and technology costs.
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Learning about money
Most people’s beliefs about money are formed when they are young. Every generation has a different set of money experiences which they apply to their own lives.
The kids of today typically buy food, clothes, entertainment and expensive electronic devices when they first come on the market. But, sadly, this new generation doesn’t have much sense when it comes to money — particularly how to manage it. The challenge for parents is to teach their children some money sense, most importantly about delaying self gratification.
Role of the parents
When kids are little, teaching them about money can be pretty straightforward. You buy them a money box and encourage them to save some of their pocket money or cash from odd jobs around the house or birthday and Christmas gifts.
One way to start them managing money is to give them some pocket money and encourage them to save part of it. Some parents go a step further and double their savings at the end of the year. Or if they are saving to buy a big item, they will meet them halfway.
There are some terrific kids’ savings accounts that have incentives of high bonus rates if children save regularly and don’t withdraw their savings. The BankWest Kids’ Bonus Saver for example, pays 10 percent if deposits are between $25 and $250 and no withdrawals are made each month.
For many kids today the money comes and then, more than likely, it goes. “The combination of a mass of products and services that are becoming the norm for our kids — such as MP3 players, mobile phones, ring tone downloads, SMS voting, designer clothes and sneakers — with more and more opportunities for credit, means that our teenagers are at greater risk of getting themselves into debt than ever before,” says David Liddy, managing director of the Bank of Queensland