Talk about money with parents of young children these days, and it’s hard to find good news. Daily life keeps getting costlier, they say — schooling, doctors, mortgage payments. Even the best office jobs no longer come with the bonus schemes that had our parents living by golf courses by age sixty-five. People are concerned.
Some are grateful to earn double what their parents once did. But that’s little help when homes can cost ten times what our parents paid for theirs. With tuition, it’s more than just the colossal cost of schooling. It’s immediate things, like fat bills for preschool. What we once called “nursery school” was optional a generation ago. Today, even kids with a stay-at-home parent often begin preschool by age three. Nicole Shinski, mother of twin three-year-old boys and a one-year-old girl, says she wanted to enrol her sons in preschool last year, but couldn’t afford two years of preschool for both boys.
Parents say prices for food and clothing haven’t risen much in recent years. But day-to-day expenses (paying the mortgage, filling the petrol tank) eat up nearly everything they earn.
That’s where the conversation gets strange. Rather than speaking of strategies to handle basic costs — how they’re finding ways to plan ahead and save and invest — parents speak of the great contradiction: how much they’re spending on things that are clearly unnecessary but that now feel all but mandatory. The optional has become the inescapable.
We’re talking $70 for mummy-and-me Mandarin classes and $7,000 for summer camp, mobile phones for fifth graders and iPods for eight-year-olds. And always, always, parents speak of buying truckloads of consumer goods — kid-friendly groceries, kid-centric versions of family staples like bath products, even furniture — much of it emblazoned with Elmo, Thomas, SpongeBob, Spider-Man and the rest of their intensely marketed brethren.
Call it crazy, insane, ridiculous; parents do. But no one calls it rare. Anyone who isn’t overspending knows plenty of people who are. Total Australian credit card debt grew at 9% in February, from $39.5 billion to $43.25 billion. Meanwhile, the national savings ratio plunged to 0.9 per cent in June this year, down from 7.5 per cent in 2004.
Add mortgages, car loans and other debt, and it gets uglier. Australia’s total household debt is currently approximately $650 billion – about $32,500 for every man, woman and child. But this is not necessarily money tied up in mortgages. Economist Ken Goldstein says, “the problem is that the people who have the assets aren’t necessarily the people who have the debt.” That’s where our generation comes in.
What’s oddest is that parents seem to know they’re being unwise with their money, but they’re doing it anyway. It’s high school redux: Everybody’s doing it . . . because everybody’s doing it. When it comes to parenting and purchasing, the definition of “necessity” has expanded to include just about everything.
But this isn’t simply a matter of well-paid Gen-Xers buying too many goodies. The details vary, but across the middle class and upper middle class spectrum the refrain is similar: “It sucks you in slowly but surely,” says Afsaneh Djabbari-Aslani, a mother of three. “Your friend is calling saying they’re signing up their daughter for nature centre, so can you sign up too, because their kid doesn’t want to do it if my kid doesn’t want to do it… Then, if your child is the only one not doing travel soccer, she’ll be left out. So you’re not paying $50 for rec soccer anymore. You’re paying $600 dollars for travel soccer… It just continues in that sense, that you keep thinking you don’t want to do it, and you end up doing it.”
Djabbari-Aslani isn’t a spendaholic. She finds it ridiculous that her tween daughter has friends who carry iPhones. She has no plans to buy one for anyone — including herself. But “I finally gave in and got a mobile phone for my thirteen-year-old,” she says, “because she was the only one without one.” If you’ve got two or three adolescent kids with their own phones, iPods and a basic video game setup, “the average spending per kid is probably hundreds of dollars a year,” says Rick King, a father of four. Those kids need computers for schoolwork and socialising, plus the games, movies and downloads that these suddenly vital gadgets require.
And there’s one aspect of this overspending trend nobody talks about, an aspect marketers hope no one brings up: For all the excess, nobody’s having spectacular fun. Worse, no one is confident that this crippling spending is cranking out a generation of well-adjusted, fabulously fit, sparklingly sociable little geniuses, either.
Parents all over the country recite strikingly similar lists of things that eat up money without delivering much more than the sense that obligations are being met. And they’re getting sick of it. The list is topped by the ridiculous birthday bashes we’ve witnessed for several years now. A slew of articles on the subject start off the same way: “Parent X spared no expense celebrating the birthday of their child. (Fill in name of costumed character) was there, and there was even a (fill in type of farm animal) on hand to celebrate little (fill in pretentious name)’s big day.” Next comes a quote from the parent, saying “I know it’s crazy, but it’s just so much fun!”
Lately, parents sound decidedly less amused. They say they did this stuff in their first child’s early years because they were so psyched to be parents. But it’s now a freight train they’d love to disembark. “I’ve spent over $500 at least once on a birthday party and felt sick about it afterwards,” says Scott Dauenhauer, a father of two. “I had the money, but what kind of example is that?” Dauenhauer, by the way, runs a wealth-management company.
Many parents sound as mildly hung over as Dauenhauer. Next time you attend one of these parties, look around — how many kids look significantly more jazzed to be there than they’d be if they were, say, playing pass the parcel? And how many parents look ready to stab themselves in the head with a plastic cake fork?
Parents speak, too, about sports. It begins younger and costs much more than a generation ago. Everybody’s playing organized sports, and many come home with trophies — sometimes just for showing up. Parents also mention wild money spent on “enrichment” activities, seeking that coveted edge for their kids. Tutoring begins in kindergarten and weekends are packed with classes. Yet, despite the expense, parents aren’t confident that kids are gaining much.
“It’s crazy,” says Georgette Pascale, a mother of two who runs her own PR firm. Spending, she says, “is almost becoming a competition.”
Parents sound most horrified by (and yet bound by) what should be the most expendable items on the list — the endless array of stuff plastered with the likenesses of Dora, Barbie, Superman and their omnipresent pals. This is the cheap crap that parents actually describe as cheap crap — stuff people are both amazed to be buying and apparently unable to avoid. On our watch, licensed characters have infiltrated nearly every aisle of the big-box stores and supermarkets. According to Susan Linn, author of “Consuming Kids: Protecting our Children from the Onslaught of Marketing & Advertising,” sales of brand licensed toys in 2006 hit $22.3 billion.
From Shrek cereal and Barbie waffles to “Cars”-themed wall paint and Spiderman lamps, piles of kid-centric stuff are sprouting in houses everywhere. Some are things kids have always had, like bikes and T-shirts and vitamins. But these characters now cause many parents to buy a slew of separate items for their kids — hand soap, towels, Band-Aids, even separate food — rather than having the kids use what they already buy for themselves. It may be just a few items per shopping trip, but multiplied out over fifty-two weeks it adds up to hundreds of dollars that could be growing in high interest savings account for university.
“When I tell my father how much we’re spending, he says, ‘You guys have to start saving,’” says Allyson Mazer, a mum of two. “But I’m like, where do you want to me to save? Where?”
Everyone lists things they shouldn’t be buying. Yet no one seems quite sure what possesses them to spend little pieces of the uni fund each weekend at Target. Part of the problem may be that our understanding of commerce was forged in front of the television, suckling on ads for Milo and Malibu Barbie. We were the first generation that had advertisers constantly whispering in our prepubescent ears that spending brings happiness. “Children’s television was deregulated in the mid-1980s,” says Linn, “and right after it was deregulated, ten of the best selling toys had links to media. In the mid-1980s, it became okay to create a program for the sole purpose of selling toys.”
Did all those sales pitches burrow so deep into our cerebral cortexes that the capacity to say no to a Spider-Man wristwatch never formed? “There was a lot of noise in the marketing community throughout the ’80s that more and more research said children recognized company logos even before they could read,” says Elizabeth Elam, associate professor of marketing at Western New England College. We grew up hearing that we really needed the Cabbage Patch Doll and the Transformers and the Happy Meal. Has all that marketing undermined the parental ability to figure out what we, and our kids, actually need?
Lines of credit function like the benevolent, deep-pocketed parents we had or wish we’d had. If we really, really want that new leather jacket, that new laptop, they give us the money. But in the heat of tearing open boxes from Amazon, it’s easy to forget that lenders aren’t giving us stuff simply because we make them proud. Those folks at VISA are gonna keep charging interest until we pay back every dollar or declare bankruptcy trying.
Maybe the hangover that people are beginning to speak about — the gnawing angst that can creep up on parents at night while the kids sleep in bedrooms brimming with toys — will be our saving grace. As discomfort over excess begins to outweigh minimal joy, maybe we’ll get it together. Many of today’s parents came to marriage later than our own parents did, and thus came to parenting later. Maybe we’ll eventually come around to saving later, too.
For those seeking to reverse course, though, there’s troubling news: Earning more may not be a remedy. The “Holy crap, I’m not saving any money” panic once associated with lower incomes is plaguing people earning serious cash. In two-income households, the costs of childcare and work-related expenses are constantly metastasizing. And more money begets larger levels of socially mandated spending. “My husband and I were just talking about this with friends. You can make $300,000 a year and you’re just getting by. You’re not saving anything,” says Mazer, all traces of enthusiasm draining from her voice. “You’re paying the bills, and it’s not like you’re living the highlife.”
The bulk discount that once came with multiple kids doesn’t help either. Tuition, childcare, sports, the birthday party circuit — you pay by the kid no matter how many you have. Even the sharing of hand-me-downs is impacted by the uneven and transitory quality of things some of us buy — bedroom furniture tied in with the latest animated movie and cheap plastic toys that won’t survive one toddlerhood to be carried into the next. There are also fresh must-have “learning” gadgets every year. What parents want to risk consigning their youngest to a minimum-wage job because he or she didn’t learn to spell early enough?
The obvious answer is to stop spending. But that’s something our culture, our economy — and our prime minister — literally beg us not to do. Widespread cutting of superfluous spending is the opposite of Rudd’s new stimulus package. And beyond economic and cultural pressure, it’s awfully hard to lower the bar of kids’ expectations once you’ve set it. “Every time someone comes over, you just get all this stuff,” says Pascale. “This is what they’re going to expect now.”
Ideally, we’d collectively adjust what’s deemed essential. But it’s not likely that we’ll all agree, as of next year, to keep our kid-related spending reasonable and restricted to special occasions, and to make sure our children’s lives are filled with unstructured weekends spent daydreaming cost-free at home.
Somehow, though, we’ve got to get smarter about our money. At this rate, some of us will literally arrive at retirement with no means of support.
Maybe as our frustration with the current picture grows, more parents will decide to prioritise savings. The line between essentials and luxuries may once again get adjusted — if not by choice, then by necessity.
Article photo: Alice Waudby
Printed from Babble Australia (babble.com.au). Copyright 2008 Allure Media. All rights reserved.