Financial management is a daily issue; if we handle it improperly, we may easily get into the bad habit of squandering and be trapped by the pitfalls of borrowing.

In the following, Miss Tracy Leung from the TWGHs Healthy Budgeting Family Debt Counselling Centre advises us to begin education on financial management with family. If you require any further information, contact the centre on 2548-0803 or the Financial Helpline of Welfare Services Group on 2804-2803.

"Financial management is only what the rich need to do! I don't have any spare money for it at all!" "Financial management is what we adults do; my child is too young for it!" These are the typical response by many people whenever they talk about financial management education. I will explore with parents the content of financial management education, youngsters' concepts of financial management at various stages of their growth and raising their awareness of financial management.

First and foremost, let us look at the socio-economic situation in Hong Kong. Our population is aging drastically. In 2003, people aged 65 or above accounted for 12 per cent of the total population, but in 2033, the percentage will rise to 27 per cent.

A review of the services for the elderly shows the Mandatory Provident Fund alone can hardly meet the expenses in old age. And it is estimated that 30 years later, the Comprehensive Social Security Assistance received by the elderly will amount to 30 billion dollars (according to a local Chinese daily dated June 14, 2005). Tackling this problem would be a challenge for the Government.

Youngsters' habit of spending, saving and investing as well as their knowledge in financial management would determine whether they could save for the rainy days in old age. However, in a materialistic society, the problem of "spending money in advance" and indebtedness among the youth requires our attention. Since the establishment of the centre in 2003, 480 persons aged 25 or above have sought help for their indebtedness. "Over-spending" is the main reason for the indebtedness, and in 173 cases the problem had to be solved through bankruptcy. In addition, according to the "Study on Financial Management Status of Undergraduates" conducted by the centre in 2004, 67 per cent of the respondents said their knowledge in financial management originated from their families, and only eight per cent considered they had sufficient knowledge in financial management.

Education on financial management is not only related to money. Ability in financial management is a tool for the youth to realise their values, human dignity and quality.

To do better in education on financial management, parents should work on three domains. The first one is "setting yourself as an example". Example is better than precept. If parents are "shopaholics" and "hedonists" themselves, it would then be difficult for them to make their children hardworking and thrifty.

The second is "developing a good habit of healthy financial management". Effective planning and allocation of family income, a good balance among spendings, savings and investment, and awareness of the consequences of being in arrears with credit card payment, loan and mortgage repayment, are important features of financial management.

The third is "learning the financial management ability and financial management knowledge of the youth at various stages". Financial management ability covers, among other things, savings, keeping accounts, spending, complying with budgets, investment, and management of credibility. There are five stages for the youth in learning financial management: emphasis on the basic concept of money for three to five years of age; emphasis on the skills of using money for six to eight, developing a good habit in using money and ability in financial management for nine to 12; correlation between financial liability and individual dependence for 13 and 15, and developing confidence in themselves in shouldering financial liability for 16 to 18.

PS & SR Branch Welfare Services Group