Question: I’m a family man and sometimes I feel guilty spending money on our birthday celebrations and family bonding. How much should I be spending on bonding activities for my family?—Asked via e-mail, name withheld upon request
Answer: Your question is very timely and it has hit a nerve with me as well. My family and I just spent a whole day in Tagaytay to celebrate my daughter’s 19th birthday. I must admit that our family getaway cost more than I’m usually comfortable with.
I’m all for watching the budget, allocation of financial resources and prudent spending habits for the family. Having a responsible fiscal discipline is key to achieving the many goals we have in life, most of them revolve around our family. I have seen many families in financial ruin because of uncontrolled spending in the name of love for the family.
It is easy to be swayed into spending more than what we should as some of us view the act as an extension of our love for our family. Some spend ridiculous amounts on family vacations and Sunday lunches or dinners, shopping or on lavish gifts for each other. If these spendings are left unchecked, one can be certain that the financial future will be uncertain.
Spending is relative to income. What we consider as expensive can be inexpensive to those who earn substantially. It is best to look at your spending from a budgetary perspective. Having budgets will allow you to plan financially so you can forecast and allocate accordingly. All items we spend on should have a budget and subject to limits.
Totally avoiding spending on family bonding activities is impractical and unwise. We are actively working for our family, right? However, we should also remember that if we spend everything on them today, we will find ourselves in a tight spot tomorrow and we put the ones we love at risk, the risk of an uncertain future.
My advice is for you to heed some prudence. Only you can determine what you can or can’t afford. Allocate certain amounts for birthday celebrations, family vacations and the occasional dining in special places. These things, while costly, are important. Our children will not be with us for very long, they will eventually be on their own. What they will carry are memories that will establish their values, which they will pass on to their children. However, do not spend on your “bonding” to the point of neglecting your savings, investments, retirement and other financial obligations. Do not spend to a point that you will already get into debt as you will just be digging a big financial pit for you and your loved ones.
Regularly review your finances, cut costs on some items so that you can provide funding for your bonding activities. I believe there is a win-win situation in this case.
I am, however, against too much frugality to a point of depriving yourself of the opportunity to build lasting memories with your loved ones. It is sad that some families have very few of these golden opportunities to share happy memories with their families—something they will regret when they realize that their wealth, when locked up in banks, can’t bring them joy. You can’t apply cost-benefit analysis on everything, especially when it involves the family.
Here’s what I am certain about and it is something I personally adhere to—I spend hard-earned money on my family because I believe it is an investment that will yield unlimited returns. My priorities on where my money goes are as follow: God and family first, everything else is secondary.
“Do not lay up for yourselves treasures on earth, where moth and rust destroy and where thieves break in and steal, but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. For where your treasure is, there your heart will be also.”-Matthew 6:19-21, ESV
Catch me at the No Nonsense Seminar on Finance: How to Invest for the Future on September 22 at the Legend Villas, Pioneer St., Mandaluyong City. For inquiries, send e-mail to [email protected]
Randell Tiongson is a director of the Registered Financial Planner Institute (Phils.)