MoneyWalk 463: Teach your children to be good money managers

This program will help you undo financial bondage.

Children do not learn through osmosis how to walk uprightly in life. They must see the right example from parents to whom they are closest and be encouraged and sometimes even made to walk out a process whereby they are going to have to make choices as to which path to take to obtain the result they desire. They are going to make mistakes because they are human, but through these mistakes and continual parental guidance they will learn which path is the best one to help reach their goals.

God has placed in each of us a knowledge of right (good) and wrong (evil) and we know that there are consequences that we’ll ultimately have to pay when we consistently choose wrong. God has also allowed each of us parameters where we live with an ability to make a number of different decisions without them being wrong. We walk in what is wrong when we choose to go outside the bounds of His specific commands that tell us not to do a particular wrong (covet, steal, etc.). Children need to be told this often and have it shared with them through scripture, so they understand God is speaking to them and not just Daddy, Mommy, teacher, or coach saying something.

You should speak and act under the authority of Jesus Christ and His moral authority. His example was (after a time of teaching and exampling how to serve people) to let His disciples go into surrounding communities without Him to serve the resident the Kingdom of God. This constituted sharing the gospel, teaching His commands and principles, and using the power of the Holy Spirit to meet physical needs (healing, delivering from bondage, giving to help the poor, being a Good Samaritan, etc.).

In order to establish a solid foundation for your children’s future, you should utilize when possible age appropriate allowances that allow children to manage a portion of the money that you plan to spend on them during each month. Your budget should be established first as an example to them and the allowance ought to be tied to optional tasks they can perform in order to have some of the treats they may desire to have (toys, food treats, outings, etc.). They should be taught that payment can only be expected for a task performed and completed well.

Allowance should not be tied to everything they are expected to do around the home or elsewhere. Some responsibilities are simply the privilege of being in the family and having their needs meet. Children should not be able to opt out of those responsibilities. Teach them this order of priority for managing money:

(1) God owns everything including what you have and the allowance you provide them. Therefore, they should look to His commands and principles for direction on how to spend their allowance and any other money they receive or earn.

(2) Giving should be the first thing they do each time they receive money. Preferably, they should be taught through your communication and example to give a tithe and free-will offering to their local church and other worthwhile ministries / charities whose works would please the heart of God. You should explain the benefits that God said givers would receive, such as give and it will be given unto you full measure and running over.

(3) Saving should be the next thing they do. At least ten percent for long-term goals put toward an emergency fund that is built to one year worth of allowances. After this is built the ten percent should be aimed at investments such as solid stocks and mutual funds. In the meantime and in-between time, they should be exposed to people and books that can explain how the banking and investment system work in our country. You should explain the wisdom and blessing that God said savers have: a wise man maintains stores of treasure but a foolish man spends everything he gets.

(4) Spending is the final step in the children’s good stewardship process. They should be told to stay away from using debt to obtain anything (no loans from Dad, Mom, or others) and to stick to using their own cash for purchases they make. If they can’t afford something that they want, they should be guided to set a future purchase goal and then save the entire amount of money before they purchase the item. You should explain that spending is a process that God established to allow us to receive many of His blessings. Yet, He designed a pathway on which to spend that would allow us to be blessed by spending decisions. Walking off this pathway brings curses into your life that will eventually show up as credit problems, foreclosures, repossessions, and bankruptcy later in life.

This process requires that you help them establish a budget, maintain it, and over time help them take the major responsibility for updating it and following it. You should label three jars: one giving, one saving, and one spending and help them learn to put the correct portion of their allowance in each jar to be spent during the month or year for the particular thing for which it is labeled. As your children mature, their allowances will likely grow as your income grows. You will want to increase their responsibility for purchasing items they desire that are not needs (gadgets, certain clothes, camps, etc.) while you continue to provide their basic needs (a home, food, and necessary clothing).

Turning this responsibility over to them to a greater degree will help them learn to make appropriate choices within the money they have and will grow them into adulthood with responsibility and wisdom that will bless them throughout their lives.

Please pray for this ministry and email any questions. May God bless you richly as you follow His plan!!!

Deuteronomy 6:4-9, Galatians 6:7, Ephesians 6:1-4, Colossians 3:20, 1Timothy 3:4-5

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