Chinese children lack a fundamental knowledge of personal financial management, a researcher said recently.

Zhang Xiaodong, who works at the Beijing Cairentang Educational Research Center, which studies youngsters' psychological health, said: "Children should learn about the concept of money, where their family's income comes from and how to manage their own finances so they can attach the right values to money."

But the fact is, very few children are actually provided with such schooling either by their parents or teachers, she said.

"The negative impact of such a lack of knowledge is obvious: Children become lavish, selfish and greedy," Zhang said.

She referred to the results of her recent survey of 44 12-year-olds from a leading primary school in Beijing and their parents, which suggested that even children from well-educated, high-income families are oblivious to the concept of personal wealth management.

The survey showed that some 43 percent of parents, most of who worked in professional fields, said they had never spoken to their children on the subject.

Just 28 percent said they had spoken to their children about bank accounts, while 23 percent said they had explained the concept of saving.

Only two sets of parents said they had helped their children set up income/expenditure records, while just one had provided their child with a structured financial education.

The children's responses echoed those of their parents, Zhang said.

Prior to completing a questionnaire, none was able to fully explain the concept of wealth management, she said.

Sixteen said they knew how much their parents earned, but only two could talk in detail about their families' expenditure.

"This is quite an urgent issue, especially as Chinese families are getting richer following the country's economic growth," Zhang told China Daily.

"Children are inclined to cultivate bad habits, such as desiring brand names and measuring everything in terms of money. They are in danger of growing up without ambition."

Zhang said that in the United States, children aged three and four can identify bank notes and coins; at five and six they can understand where money comes from; and by seven to nine they are capable of reading price tags, comparing prices, saving money and drawing up simple one-week expenditure plans.

By the time they are 10 to 12, they understand that to pay for large items they must save money on a weekly basis, Zhang said.

They also understand some banking terms, she said.

Parents and teachers should educate children about how to view and use money so they could develop self-respect, independence and a sense of responsibility, Zhang said.

(China Daily October 24, 2007)