Tips like these helped us pay off $127K in debt. You can read our story in Slaying the Debt Dragon: How One Family Conquered Their Money Monster and Found an Inspired Happily Ever After.
Can we be real for a minute? Parenting is daunting at best, downright terrifying at worst. Early in an infant’s life there are so many details to attend to and it seems like everyone has a strong opinion about how you should feed, soothe, clothe, bathe, and diaper your child. Then you move into the toddler years when that sweet little baby somehow converts to a willful child who can channel his or her inner Chuckie in the grocery store aisle at the drop of a hat or when you say no (every single time you say no). You move on to the elementary school years and combat challenges like the playground bully and learning cursive writing. On to middle school (or as we like to call it, the armpit of existence) with its hormonal issues and crazy kids all crammed into a small space while they literally become teenagers over the course of three years. Round things out with the high school years where you pray for wise choices when new independence entices even the strongest kid down its thorny path. Then college, then marriage, then parenthood all over again but with a new generation.
No matter how old or young, your child needs skills – skills to survive in the world, skills to provide for themselves and their future families, skills to reach up to embrace life fully without allowing the temptations of the world to drag them underground. Ancient Scripture teaches us to “Train up a child in the way he should go and when he is old, he will not depart from it.” Proverbs 22:6 (NKJV). Said another way, “Point your kids in the right direction – when they’re old they won’t be lost.” Proverbs 22:6 (The Message).
In our home, we’re passionate about teaching the lessons we’ve learned about money through the context of our failures (hello $127,482.30 in debt) and successes (wahoo for paying all of it off). Knowing how to teach kids about money will equip both you and your children for the days ahead insuring that “when they’re old, they won’t be lost.” The topic was so important, I included an entire chapter in Slaying the Debt Dragon to provide you with plenty of practical tools and ideas to help you in this tricky area of parenting.
Always:
Be Honest & Casual
Let’s face it, your kids probably already know about your struggles in life. Whether you overspend or are constantly late, your habits aren’t going to shock them. So rather than sweeping your issues under the rug, share where you are financially. For us, this meant talking to our then Kindergartener (who is now 13) when we began our journey of paying off debt, explaining in age appropriate terms about how we planned on scaling back our lifestyle for greater goals. I’m not sure she fully comprehended it; however, the mere practice helped create a culture of openness in our home.
Even if your kids don’t know what’s going on with your finances, they will pick up on your stress levels and even passive aggressive behavior with your spouse (you bought what?!). This creates what I refer to as the Monster Under the Bed Syndrome. A child might jump to the conclusion that the state of your personal finances to be much worse than they actually are. You also don’t have to have a family summit, laced with formal language and a boring professorial lecture. The more natural the conversations, the more likely the lessons will stick.
Use Everyday Experiences to Teach
I love Deuteronomy 6:6-9 blueprint for parenting that instructs us to teach children while we “sit at home, when you walk along the road, when you lie down and when you get up.” This means we naturally teach our kids about our world. Let your kids help pay the bills. Show them how to write a check. Talk about financial words – the difference between debt and debit can be a big challenge for many kids. Take your kids grocery shopping, share your budget for the week and have them help you stay with in those bounds, allowing them to help keep a running tab of what you’re putting in the cart. At age 9, our oldest daughter planned her entire birthday party, managing the budget and choosing what she wanted to do, how to decorate, and even what we would eat based on agreed upon amount. She loved the pursuit of keeping costs low (especially since we promised her leftover funds would be hers for whatever purpose she chose).
Talk About How Much Things Cost
Candy bars, cars, and college educations all come at a price tag. You might be surprised at how little even big kids know about what each of those items cost. Ask what your kids think certain items cost. It’s at minimum a fun game to play. Help point out the cost of items you see throughout your day.
Help Them Manage Their Money
We’re big fans of the three envelope system for our girls. Both have a Give envelope where they put 10% of all their money (birthday money, odd jobs around the house money, grandparent coins, etc.). They also have a Save envelope where they put 10%. And finally the remaining 80% goes into the Spend envelope. By the way, I have FREE Printable Budget Envelopes for Kids in case you’d like to print some out and use them with your kids. We set short term and long term savings goals. The Princess Eldest (13) has been saving for a car for a couple of years already, knowing we’ll match what she saves up to a specific dollar amount.
Avoid:
Constantly Complaining About Your Finances
Look, I get it. You’re stressed about money and let’s be honest there are several times where we just want to reply “Because we can’t afford it! That’s why!” But your attitudes about money are inherited just like those baby blue eyes. Hopelessness, lack of control, lack of planning – all can be passed along to your child. Wouldn’t you rather give a legacy of generosity, contentment, and careful budgeting?
Saying Yes or No Too Often
So this is a tricky tension for all of us to dwell in. Constantly say “no” and you’ll create a wild beast who indulges in everything once beyond your protection. Say “yes” every single time and you’ll foster an equally ugly monster who has no limits. Choose your moments to bless your children, and know when you must restrain. Be the parent and help guide your kids along the path.
Using Plastic
Being a credit card survivor, I’m never going to tell you using one is a good idea. But even debit with small children may send mixed messages about where money comes from, as well as its worth. Whenever you can, opt to use cash to make your purchases. Involve children in counting coins and bills and remind them that the money is a result of work and doesn’t just appear out of the ATM like a genie pops out of a bottle.
Thinking They’re Too Young
Sure, your toddler might not be able to even pronounce fiduciary, let alone know what it means. However, thinking your child is “too young” to understand budgeting or managing money is a big no-no. After all, budgeting is simply money in, money out and anyone can understand that if you don’t have something, you can’t spend something. Even elementary children should be able to understand the FREE Printable Monthly Budget Sheets I have available for you. You can choose to share your specific household numbers or make up round “example” numbers to help a child practice. Set up a bank account. Encourage them to use part of their own money for some practical items (listen clothes, food, soap those are on you but cute hair ties or character shoelaces might be something your kids should pay for). From birthday gifts for friends to offering at church, part of your child’s experience should be learning how to give away money, pay for needs and wants, and save for the future. They won’t grow up too fast or miss out on the miracle of childhood. Give them a little credit. After all they’re brilliant, they take after you.
So many of us wish that our parents would have taken more time to teach vital money lessons. Life can be busy but eternal teaching like this lasts a lifetime and maybe even beyond. Shape your child’s tomorrow by teaching them today.
For more on teaching your kids about money, read:
- Should You Tell Your Kids You Are in Debt?
- How Grocery Shopping with Kids Can Increase Their Financial IQ
- The First Lesson for Kids to Learn About Money
- FREE Printable Budget Envelopes for Kids
- Helping Teens and Tweens Budget at Back to School
My book is now available: Slaying the Debt Dragon: How One Family Conquered Their Money Monster and Found an Inspired Happily Ever After. You can also check out Inspiration to Pay Off Debt: 30 Days of Encouragement from the Queen of Free
This post contains an affiliate link. That means when you get a great deal or maybe even something for free, you also help our family pay off our mortgage early. And for that, we royally thank you!
[…] an excuse to throw caution to the wind with a careless attitude. Simply put, parents will all have different approaches to teaching their children about money and that’s OK. You’re not condemning your child to a life in a pauper’s prison by missing out […]