Back to Basics

  For many urban dwellers, credit cards have become almost indispensable, what more with the tempting discounts offered by banks and zero-interest instalments for purchases of items that usually take us months and years to save up for. Being new in the world of credit cards, I took to seeking the advice of a friend who used to have seven credit cards in his possession and previously worked in the credit collection department of an international bank. Considering my affinity with numbers, or the lack of it, it took me some the time to understand the workings and dynamics of the system, and the pros and cons of several types of cards, depending on which company it belongs to.

  As I researched more on it, one thing that kept cropping up was how the utilization of credit cards have impacted the spending capacity of youngsters, driving them deep into debt within months of entering the workforce. The figures became worrying over the years, so much so that at one point in 2011, Bank Negara decided to restrict the spending of those that earned less than RM36,000 by imposing a capped credit limit of RM12,000 per card holder.

  Thought this much warranted guideline has controlled the spending habits of most consumers to an extent, the living-beyond-means attitude so prevalent among the urban society needs much more than rules imposed by a national bank. It needs a change of habits and a look at a lesson of financial management I learnt from my grandmother.

  My maternal grandparents are native Indians who were born during the pre-independence era of India. Though I never had the privilege of growing up with them, frequent visits to India and stories my mother told me about them were enough to provide a peek to the two wondrous souls. My Tata (grandfather) lived up to 94 years old while my Amachi (grandmother) was about 85 years old or so when she passed away, and notably throughout their long life, they were never totally dependent on anyone financially, not even their children. My Tata was a respected government officer and though his earnings were not much, it was enough to support Amachi, their four children, and a portion of household expenses that were shared by tata’s eight siblings, all of whom were living with their respective spouses and children under one roof. Speak of giant joint-families. Despite being the average middle-class family, my grandparents, or to be more exact, the brilliant money managing strategy of my Amachi enabled them to support the education of their children up to university. They also bore all the wedding expenses of my mother and her siblings, which is saying something for Indian marriages are mostly grand and super-expensive.

  After Amachi’s death, my mother and aunt were going through her things, basking in nostalgia, when my mum came across a small tattered book placed in the crook between the neatly folded sarees of my grandmother. As she examined the yellowing pages, she was stunned to discover that it consisted a detailed description of the expenses during my mother's wedding 26 years ago. Every single penny spent was meticulously jotted down to decimal points. Amachi actually continued the practice of writing down expenses and kept all the records up to the day she was bedridden, after which the task was continued by my aunt after much prompting from my dear old grandmother.

  During my younger days, whenever my siblings and I went to visit her, she always pressed a few currency notes into our hands with her shaky fingers, hushing our protesting sounds with a sharp chid and walking away with utmost satisfaction on her face. I always thought she had a treasure chest somewhere from which she can 'withdraw' any amount that she pleases before I found out that the particular act of giving was only possible from a habit of saving and smart-spending. She was even particular about having her own money spent for her funeral rites.

  I could not help thinking that a woman like my grandmother, scarcely educated and so docile to the extent she often does not step out of the house alone, had the prudency and foresight to manage the economical state of affairs in her family which benefited three generations. How many of us now can ensure that we would, in our future days be in the state that my grandmother was, always a giver and never a receiver. Looking at the current state of society, with or without credit cards, I would say barely a handful. It is high time we take a serious look at our financial state and probably take the first step by starting with a pen and a ‘555’ book. It all comes down to basics sometimes.