Still Treating Your Parents LIKE AN ATM?

Like it or not, it’s time to cut the financial umbilical cord.

Portrait of Tammy Strobel
Like it or not, it’s time to cut the financial umbilical cord. 
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Complete visibility is the first step to being smart with money. Checking your account balance regularly and planning ahead will help you stay in control.

Action. Set financial goals, open a high-interest savings account and sign up for online tools that can help. Procrastinating about money will make it likely that you’ll need a bailout.

Save for a rainy day. Always try to put some money aside for unexpected expenses.

Budget. Even if you break it, having one will make you think before you spend and help you live within your means. 

What do Rachel from Friends and Hannah from Girls have in common? Apart from being lead characters in TV shows with one-word titles based on nouns, they both suddenly found themselves financially cut off from their parents. “No. More. Money!” Hannah’s mother pointedly declared in the opening scene of Girls. If, like Hannah and Rachel, this sounds like your idea of a living nightmare, it might be time to stop using your parents as a fiscal crutch. Experts say that speed-dialing mum and dad at the first sign of an overdrawn bank account is just setting us up for long-term financial failure.

But… bills

Elaine*, 26, graduated from university two years ago. Since that time, she has asked for roughly $8,000 to pay back loans, insurance premiums, and late phone bills.

“I know, it’s appalling. I’m an adult and I should know how to handle my money properly. But it’s hard and they don’t exactly teach you about budgeting in school,” explains Elaine.

“Sometimes, I just forget that there’s certain payments to make that month, and there’s a late fee imposed if I don’t pay on time. It just doesn’t make sense to shelve out more money when I can ask my parents to help me out first.”

And her parents’ reactions? “Of course they’d nag at me every time I ask them to make a bank transfer, but they’ve never threatened to cut me off or anything.”

It’s easy to shake your head at Elaine’s behaviour, but ask around and you’d find that adults well into their twenties or even thirties are still taking money from their parents, be it for a wedding, credit card payments, or a house they couldn’t afford in the first place.

Your parents can’t save you

Peter Lord, managing director of online financial community and resource hub MoneyBrilliant, says even though our parents have good intentions, they’re teaching us the wrong lessons about money if they continue to hand it out tous whenever we find ourselves in a bind.

“We all make mistakes with money at some point in our lives, but what we learn from those experiences is very important. If your parents are always bailing you out, you don’t get the benefit of learning how to correctly manage money. And later in life, when the stakes are higher and the potential for real hardship is greater, you could find yourself in a lot of trouble,” he explains

It sure sounds like a great reason to start thinking about sorting out our finances, but let’s be honest – Singapore is an expensive city to live in. By the time we set aside cash for our monthly bills, transportation, food, and weekly brunches with our girlfriends, most of us would barely have enough left for savings. So how are we supposed to get by without our parents’ help?!

Spend less or earn more

“Nearly everyone struggles with money, but until you take action to get yourself into the best financial position you can, it will seem like you can’t get ahead,” says Peter. “You have two options when money is tight – spend less or earn more. Write down everything that is coming in and going out. You’ll be surprised how incidental spending adds up and how being more aware can get you into a better position.”

Hey girl, it’s payback time

Money-saving tips aside, Peter concedes that there are circumstances when it’s OK to ask your parents for money (and no, another designer bag is not one of them). But if you’re going to do so, and in order to learn not to take their generosity for granted, make sure you pay them back. “Set up a payment plan with an end date and deposit what you owe in fortnightly or monthly instalments – you’ll feel empowered knowing you can handle your own financial affairs,” suggests Peter.

It’s a sentiment that Elaine agrees with. “I’m already trying to pay off the money I owe my parents by cutting down on my expenses. Before I buy anything, I’ll ask myself if I really need it, and sometimes, I’d even wait for three days before checking out my online shopping cart to make sure that I’m not buying on impulse.”

“I know I’m not being the best daughter by borrowing money from them, but at least I’ve realised my mistake and am making amends.”

*Name has been changed.

Of course they’d nag at me every time I ask them to make a bank transfer, but they’ve never threatened to cut me off or anything.”

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