Teaching Kids Money Management – Guest Post

I was tucking my eight-year-old into bed one evening when the subject of his first car came up. (We’re a boy-filled house, you see. We talk about cars, and dragons, and fire. A lot.)

Anyway, he informed me that he would be buying his first car when he got to college.

Oh, really? I asked. And how will you pay for it?

I’ll just write a check! He looked up at me smugly.

He wasn’t so smug when I got through explaining that a check actually represents real money saved and stored in a bank somewhere. I’m not sure what he was envisioning but it sure wasn’t saving a few grand before college.

One thing is certain: It’s never too soon to begin teaching kids about finances.

Or, to be more precise, about stewardship.

Stewardship – the careful and responsible management of something entrusted to one’s care – God has entrusted us with certain earthly things and expects us to be good stewards of those things. Our money. Our family. Our homes, etc.

My husband and I want our boys to grow up with the idea that stewardship is an honor and a privilege as well as a responsibility. It should be second nature to them to think of what they earn as God’s first, theirs second. We never want them to begrudge the weekly gift to the church, but to see it as a welcome responsibility.

One of the things we implemented this year is giving both boys a weekly allowance. Gabe went to the bank and withdrew enough $1 bills to make everyone at the bank nervous. After he explained to the bank manager our plan, everyone had a good laugh and all was well.

On Sunday mornings, both boys are presented with their weekly allowance. $5 for the oldest and $3 for the youngest. Each boy is given their sum in one dollar bills and change so that they can immediately put 10% of their allowance into a jar that will shortly be deposited into a  savings account, and the other 10% goes straight into their pocket to be given back to God when the offering is collected at church. The rest they can keep to spend on what they’d like.

With this weekly allowance come certain expectations that we’ve discussed with both boys:

• We expect them to help out around the house. We all live here, and we all are stewards of this home. We take care of our home and our yard, together.
• We expect them to have responsibilities in accordance with their age. My nine year old son gets a larger allowance because he is expected to do a lot more around the house.
• We expect them to use their money to help purchase gifts. When it’s someone’s birthday, or at Christmas, we’ll help out, but they need to pitch in with some of what they have saved.
• We expect them to pay for some of the weekly “wants.” Dying for McDonalds? Great, you can use your allowance. Whining in Target for something from the candy aisle? No problem. How much of your allowance have you saved up?
• We expect them to give back to the church each Sunday. Above and beyond that, they may use their money when there is a fundraising bake sale or other special collections for missions, etc.
• We expect them to save. We plan to take both boys in person to our bank and open up an account in their own names. This may seem odd to do with a five year old, but with compounding interest, a little saved every month can eventually grow into enough for that first car.

We also expect them to make poor choices from time to time. It’s how they learn! My oldest was on a field trip to the local science museum and spent every penny of his saved allowance on a large glass paper weight. Despite our caution, he kept it out to play with until he dropped it on the tile floor the very next day. It shattered, and so did he … for a little while. It was a painful lesson for him to learn, but he confessed to me later that perhaps a $14 impulse purchase for something so fragile might not have been a wise choice. I didn’t have to do a thing to teach him this lesson; he learned it entirely on his own.

It’s all part of the process of raising adults, not children. Adults who may one day be stewards over thousands of dollars, not dozens, who will buy homes and cars and give back to their community and their church. By the grace of God, and lots of prayer, we hope we’ll send them out into the world empowered to be good stewards over whatever the Lord decides to bless them with.

How do you teach stewardship to your children? What are some ideas you’ve used to help kids understand finances and the importance of saving and giving back?

 

 

Adelle Gabrielson is a writer, speaker, and wife to her first love. A former marketing executive turned boy-mom, Adelle now spends her days working at her church or speaking to MOPS, while her evenings are filled with keeping the peace (and the house from burning down). She has two boys, ages 9 and 5, two cats (who may also burn down the house) and a husband named Gabe (who is amazing). When not writing or sharing her heart with other women, you can find her reading, digging in the garden, or shopping for shoes. Visit Adelle at her website www.AdelleGabrielson.com, or follow her  on Facebook or Twitter.