by Moc Mien
Pham Chi Mai, 26, has been struggling to pay off her credit cards after an impromptu spending spree three years ago. The money she has borrowed has now reached nearly VND100 million - rather a lot of credit for someone her age to be used up on general shopping. "I don't know why the money I earn just disappears at a glance and now I'm even more in debt. My financial status is driving me crazy," she said.
Mai, 26, was born into a problematic family where her mother often gambles and is heavily involved in the black market. "We are always in need of more money. It has become an obsession."
The trouble Mai has got herself into is becoming more prevalent in today's Viet Nam. Ironically, as modern society attempts to provide young people with more opportunities to earn a living, it has not yet succeeded in teaching them how to budget and spend their money wisely.
In 2012, a survey of the spending habits of pupils in 50 high schools across HCM City was jointly carried out by the city's Department of Education and Training, Save the Children, and the Citi Foundation. The subsequent results took most stakeholders by surprise.
Accordingly, one third of the polled students revealed that they received an allowance of between VND200,000 to 1,200,000 every month. Thirty-six per cent of those surveyed came from 'wealthy' families and could expect up to VND3-5 million a month for personal spending. Most surprising of all was that 25 per cent of them were given VND500,000 a day or VND15 million a month by their parents.
Despite the huge allowances, one third of the students questioned thought the amounts were less than they needed for their daily expenditure. They found it difficult to cope with unexpected situations and as a consequence, they had to borrow from relatives or friends.
The survey also revealed that the most allowances were spent on clothing, cosmetics, cinema tickets and on eating in salubrious restaurants as a way of showing how well off they were. If their allowances did not cover all their expenses, they simply insisted that their parents cough up more money.
"I think there is a big difference between the generations. When we were young, we still tried to save as much as we could. We learned how to make our own clothes and cook and we enjoyed the more simple things in life. It was partly because jobs were hard to come by and we had to take responsibility for our families rather than live for ourselves. We understood the true value of money and we knew to treat it with respect and use it sensibly" says Lai Ly, a 63 year old.
Ly does not expect young people to act the same way her generation did in the old days. "Things change and young people now have new ways of living. But I am sure that in my day our behaviour concerning money reflected our background, culture and sense of responsibility."
The issue of young people spending frivolously ultimately focuses on the essential role parents and schools play when preparing young people to become financially independent. Most of the students questioned in the survey said that they were not taught how to spend wisely, without commenting on the dubious spending habits of their own parents. Meanwhile, the country's education system pays no attention to teaching personal finances or budgeting skills.
In reality, not many countries in the world actually include financial literacy courses in their mandatory curriculum. People who are in need of this kind of information have to approach bodies that provide financial advice themselves or find an appropriate website.
Fortunately, the US, the UK and a number of other countries have recently been drafting new curriculum's that include financial education for the first time. In an interview with the UK newspaper The Daily Telegraph, Justin Tomlinson MP, chair of the All Party Parliamentary Group (APPG) on Financial Education for Young People, confirmed the importance of the change.
"Generations of young people will now gain the knowledge and skills they need to be able to manage their personal finances," he said. "This will make a real and lasting difference to financial capability in our country [the UK]."
Viet Nam is no exception as people here have even less idea about personal finances than in most other countries. It is important to bear in mind that currently, financial management in the country is mainly experience-based instead of adhering to sound financial practices. Financial illiteracy and the difficulties involved in trying to earn a living contribute to the miserable financial status of many people. This is also the case in Mai's family.
Aflatoun (Child Savings International), a non-governmental organisation that focuses on educating children about their rights and responsibilities and managing their financial resources through social and financial education, has now confronted the issue in cooperation with the Ha Noi Department of Education and Training. They have recently carried out a series of activities to mainstream financial literacy to young people across the country.
As one of its target groups, during the academic year 2011-12 and 2012-13, pupils at Doan Thi Diem Primary School attended several workshops and outdoor activities. These included leasing out books and cartoons for money, playing as book keepers and discussing how to encourage sensible money-related practices. As Tran Cong Tu, secretary of the schools Youth Union, said, "The campaign has achieved a lot but it has not yet managed to change the behaviour of many students because it is just an extra-curriculum activity."
Tran Bich Ngoc, whose daughter attends the school, said that her daughter had told her what she had learnt from the activity but she had failed to take in the knowledge and skills because of a lack of a comprehensive approach.
"I really care how my daughter treats money even though she is still quite young. I think if she gets some kind of formal financial education, she will grow up without being confused or intimidated by financial matters. I want my child to have a more comfortable life than we had," Ngoc said.
"But I am also aware that we, as parents, need to set a good example and take care to educate our children before relying on the State or anyone else," Ngoc added.
Sometimes we need to change our family traditions and spending habits before blaming other external factors that affect our finances. The author believes that if parents put in enough time and effort on education in general and personal finances in particular, cases like Mai or the other surveyed students will become a thing of the past.
It does not depend on how old your children are before they start handling money. It depends on how well they manage the money by themselves. — VNS