Phnom Penh: “Our children love us, we let them spend, we don’t regret it, but we have our conditions,” said Valkuch Phalla, 41, a mother of two, a boy and a girl, telling Newsroom Cambodia about how she teaches her children to save money. Her son graduated with a bachelor’s degree from ACLEDA Business School and is studying at the Institute of Foreign Languages (IFL), and her daughter is a first-year student majoring in accounting and finance at a university in Phnom Penh.
Valkuch Phalla, 41, and her husband, Hin Chamroeun, were both born during and after the Khmer Rouge era, one of Cambodia’s darkest regimes. Therefore, the life of her family and her husband during her childhood was very difficult and she had to think about her expenses very carefully.
After the Sangkrum period, her parents lived together with several other families in a three-story apartment building in Phnom Penh. Her family lived on the third floor of this apartment building. Under the roof of this third-floor house, in addition to living and doing other business, her parents also raised pigs that weighed more than 100 kilograms. She observed this from the efforts of her parents, who tried to save until they could save some money to help her child go to school and have knowledge as a capital in life, even though she did not finish high school.
Parents or guardians, who are considered the first teachers of their children, have an important role in being a good role model for their children, teaching them to be disciplined, especially teaching them to save money. This is an important part of educating children so that they can gain life skills that can be used in the future.
Ms. Valkuch Phalla learned how to save money from her parents who can help support the family well. She describes with a smile the method she uses to discipline her two children to save money by giving them money as an incentive when they achieve good results in their studies in both Khmer and English.
She said: “We rank the first to third place, we offer $10 or 40,000 riel. Number 4 or 5, we give 20,000 or 5 dollars.”
“Saving money” refers to keeping some money in the present for future use. According to the official Facebook page of LOLC (Cambodia) Plc, a financial institution in Cambodia.
A study by Tribhuvan University in Nepal on “The Influence of Parents and Friends on the Saving Behavior of Youth” shows that parental encouragement to save money has a significant impact on the saving behavior of youth. The study was conducted in 2018 among 390 undergraduate students.
According to Charles Duhigg’s 2012 book The Power of Habit, rewarding positive behavior helps our brains to continue doing something in the future.
For Ms. Valkuch Phalla, this reward for good academic performance allows her children to receive an average of $15 from her, in addition to other subsidies that her children may receive from their grandparents. She says that this practice is the basis for children’s savings from childhood.
She says: “So if we say, what does this child do, how does he earn money, there will definitely be questions, whether it’s me or not. But the money he earns through his studies.”
She added: “That way, her education will increase, her money will increase, and her future goals will be achieved.”
How to Teach Your Children to Save Money
Ms. Valkuch Phalla is also a member of the Lady Saving Group. The Lady Saving Group was established to share knowledge and experience, leadership, entrepreneurship, socio-economic rights, and quality of life for women in the new era.
Ms. Valkuch Phalla proudly says of her children’s savings that such savings encourage her children to be able to buy personal items according to their wishes, such as bicycles or phones, and she only helps to supplement some of the funds. She always reminds her children to work hard in their studies and saving money.
Because more than 10 years ago, the financial system in Cambodia was not as open and diverse as it is today, Ms. Walkuj Phalla used a regular notebook, divided into tables, to determine her children’s spending and track their savings.
“So we have a method: we make a book, our book, a handwritten book, and we operate like a bank. We operate, withdraw money, and the dates are like a bank book,” she said.
Recording your income and expenses will help you plan your finances effectively and achieve your long-term financial goals, according to the official website of Indonesia’s Bank Central Asia (BCA).
Mr. Tum Tola is the Director of Life Skills and Leader in Me of the Wesline Education network of educational institutions, which has a financial literacy program, Mon.
ey Tree. The Money Tree program, licensed from Singapore, teaches children how to save money, invest, and avoid materialistic pressures.
Mr. Tum Tola said that most schools in Cambodia and abroad do not focus on saving money, but students generally receive this knowledge from their parents. He stressed that if parents have a habit of spending, this behavior will also have a negative impact on their children.
“If our people do not understand financial literacy, no matter how much wealth they can earn, they will not be able to save their wealth and use it wisely,” he told Newsroom Cambodia.
Mr. Tum Tola said that some parents or guardians have their children do household chores, such as cleaning the house and looking after their siblings, in exchange for a small bonus.
He added that other parents also use their children’s academic results as evidence to get extra bonuses.
“If he is in the Top 10, how many? Top 5, how many? That’s it. It’s a motivation tool to encourage children to save money,” he said.
According to a study on children’s understanding of finances and parents’ preferences for financial literacy in Malaysia in 2023, which studied 419 schoolchildren aged 7 to 12, it was found that schools and parents or guardians play an important role in instilling financial literacy in children.
According to Mr. Kaing Tonggy, a spokesperson for the Cambodian Microfinance Association, financial literacy is not yet a core curriculum in schools in Cambodia and abroad, so young people have to rely on themselves or their guardians to teach them. Another option is to save money in a financial institution, which Mr. Tonggy says is safe and can earn additional interest.
Ms. Seng Sreilak, 21, is a third-year student at ACLEDA Business School. She receives a daily allowance of between 12,000 and 15,000 riel per day, depending on her daily expenses, such as fueling her motorbike. During the holidays, Srei Lak’s father, a security guard, always gives Srei Lak extra money he earns from working overtime. In addition to daily expenses, Srei Lak saves the rest by raising pigs.
Ms. Seng Srei Lak said that her mother lost her parents during the Pol Pot regime. Her mother struggled through life, working in a restaurant until she became a maid at an ambassador’s house in Phnom Penh, and quit to start her own business before the COVID-19 outbreak.
She recalled her mother saying, “She said, ‘Whatever you have left, put it on the pigs.’ No matter how much, she said, put it on the pigs.”
According to research by the East-West Center published in January 2001, after the Khmer Rouge era, Cambodians had only $28 per person in their pockets (or about $106.13 in 2024, adjusted for inflation), and this money was only circulating in the city.
In early 2024, the National Bank of Cambodia and the Ministry of Education, Youth and Sports signed a memorandum of understanding to implement a project to integrate financial literacy into the national curriculum after the two state institutions led a meeting in late 2023. The current three-year financial literacy project covers grades 5 to 12.
Ms. Khuon Wichichaka, a spokesperson for the Ministry of Education, Youth and Sports, said the curriculum includes a science subject to teach students about various life skills, including saving money.
“We are also collaborating with external partners to organize another program, which we call Cha-Ching,” she added. “In addition, with the National Bank of Cambodia, we are also organizing additional financial programs,” she continued.
The Cha-Ching program is a basic financial literacy program with four main goals: earning, saving, spending and donating, which began in 2016. According to the official Prudence website, the Cha-Ching program is a collaboration between JA Asia Pacific and the ministries of education of several countries, including Cambodia.
Life Lessons for Parents: Teach Your Kids to Save
Although it is important to teach your children to save money and understand financial literacy, experts say that parents need to strike a balance between saving and spending wisely, and not be too stingy in spending.
Mr. Tum Tola, Director of Life Skills and Leader in Me at the Wesline Education network, believes that one of the consequences of teaching children to save is being stingy in spending, but this action shows that they know how to spend wisely. However, he believes that such education has many positive effects on children in the future, especially those children who will grow up to be wealthy in the future.
He claims: “Children who have financial literacy will not be poor.” He added: "Because he knows how to use money properly, meaning he knows how to save, he knows how to make money, he knows how to invest, he knows how to open a business."
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