Teaching Kids About Money

Probably one of the greatest gifts anyone can ever receive is the responsibility of being a parent.  Parents are responsible for coaching and guiding children through life.  As you can probably recall, there are many uphill battles along the way to adult life.  It doesn’t get any easier as an adult since the responsibilities increase.  We find ourselves leaving school and starting a job for the first time.  And along with this responsibility comes a greater responsibility for managing money.

Were you prepared to manage money?

How well were you prepared the first time to manage money when you had to support yourself?  Did you begin with a plan for your money?  Did you know the importance of giving, saving, spending wisely and ultimately, what it means to be a financial steward?  I venture to say the majority of society can’t answer these questions the way the would like to answer them.  No, most people aren’t prepared for their adult lives in the area of money.  We end up learning the hard way by strapping weights of debt to our ankles and dragging them around until we’re just too tired to drag them around any longer.   Obviously, at this point, we make a change.

Personally, I’ve always been serious about personal finance.  I got more serious about it when I got married because I felt a new responsibility towards my wife.  I got even more serious about it when we had children.  My children were  a good reason, amongst many, to put our finances in order, get out of debt and live as wise financial stewards.

Obligation to teach children about money

What are our obligations as it relates teaching children about money?  Scripture tell us we should train our children in the way they should go; the proper way, in my mind.  When they are older (when they get that first job out of school) they will not depart from parental training.

Train up a child in the way he should go, even when he is old he will not depart from it (Proverbs 22:6).

As parents, coaches and trainers we have a fantastic opportunity to prepare children to manage money wisely and hopefully, not repeat the mistakes of our past.  How do you plan to teach your children about money?

Ideas to teach children about money

• Start as  early as possible.  When a child understands money can buy things they can begin learning about the proper way to use it.
• Children can’t learn to manage money unless they have money that is under their care and responsibility.  Start your child on a small allowance.  Teach your child to allocate a portion of the money to giving, saving and spending.   I like the idea of using three banks for this weekly exercise.
• Teach your child the value of giving.  A great way is to teach them to give is with the church offering.
• It’s important for the child to understand the value of work and how to earn money.  Don’t let the allowance be for nothing.  Assign household responsibilities so the money can be earned.  Each household responsibility should earn a certain amount of money.  When the responsibility isn’t fulfilled, the money can’t be earned.
• Once the child has money to spend, teach how to avoid impulse spending.  Obviously, this is more challenging with the young ones.  But, a child can learn to shop around or wait before making a hasty decision.
• Teach your child to save money until they have enough.  Certainly, some things will cost more than their spending money will allow to purchase.  If the child doesn’t have enough money, it’s a great opportunity to teach this principle which will lay the foundation of avoiding future debts.
• Most importantly, teach your child what the Bible has to say about money.  Consider using Biblical financial principles as you coach through any of the above situations.

Photo by theritters.