It doesn’t take long for kids to understand the concept that money can get them things they want. If Grandpa gives them a couple of dollars, they will usually start begging to head to the dollar store to purchase some new “treasure”.
Unfortunately, kids aren’t born knowing how to be good stewards of the money God gives them. They are usually generous at a young age, but if parents don’t work with them – generosity can quickly turn to greed. If you don’t teach them how to handle money in godly ways, they won’t necessarily learn it by just watching you.
Handling money well is complex even in a secular environment. When you add God’s expectations for helping others and the church with our funds, it can become even more intricate. If you don’t teach your kids from a young age how to budget their money, they may struggle financially for many years. Check the average credit card debt in our country and you can see how bad the problem can get.
There is a very simple way to begin to introduce your kids to budgeting and God’s priorities for how we spend our money. Give your kids an allowance that is easily divisible by four. When our daughter was really young, I think her allowance was four dimes. Over the years whenever she got a raise, we continued to make it four quarters or four dollars or some other amount divisible by four until we felt she had internalized the concept of budgeting.
Then grab four containers. They can be piggy banks or plastic baggies. Make sure they either look different or are marked in some way. Explain to your kids that they will now receive an allowance (or a raise in allowance), with one twist. They need to give 1/4 of it to God, save 1/4 of it for family gifts (or to help other people – your choice), save one fourth of it for something large – we picked college (even though we knew we would help her) and they are free to spend the remaining fourth in any way they choose.
You will probably have to remind them for awhile until they get into the habit of placing the correct amount of money in each container. As your children get older, you can begin explaining to them that as an adult budgeting won’t be quite that easy. You may even want to share some of the things your family must pay for each month. Dave Ramsey has some great free online tools for helping teach children and teens how to create a more sophisticated budget. (I don’t get anything for saying this, but our daughter loved the video series for teens when she was younger.)
During the teen years, many families drastically increase the amount of the allowance, but the kids are then responsible for clothes, fees for extra-curricular activities and more. (Note:Before doing this, make really sure your child can handle it. Bailing them out because they can’t afford new clothes for a year from poor choices won’t teach them an important lesson.)
Remember, this process is teaching them important, godly Christian life skills. You are going to have to allow them to make some mistakes and learn from them. If they spend their money on a cheap dollar store toy instead of saving for a more expensive well made version, you need to let them discover for themselves why it wasn’t the best idea.
Teaching your kids godly money management skills takes time and effort on your part. Trust me though, when they reach their college and young adult years, you will be glad you did!