Teaching Your Children About Money
By Steve Scalici
Vice President of Treasure Coast Financial
One of the best ways to teach young children about finances is through an allowance. While some parents believe kids should work for spending money, giving an allowance to younger children can prove to be beneficial. Once they are in high school, you can give them more, but with the additional income comes additional responsibility. The child can begin to make her own decisions regarding the allocation of her funds. That helps them learn they can't do everything. It also keeps us as parents from being the bad guy and saying, "No, we can't afford that."
You shouldn't tie their income to work. (Though they should be able to earn "extra" money by performing special tasks). You should your children to "pitch in" around the house as part of their family duty. This teaches them that clothes do not "magically" find their dressers and/or closets after being miraculously washed. Children do need some money of their own to manage. How else will they learn to handle it?
A biblical principle you must stress is tithing. That comes off the top. After the tithe comes saving, though you can't expect children to save a whole lot if you don't pay them much. However, starting them on a savings plan early will do much for them in the future when they are making real money.
I know a teenager that keeps a ledger of his money that he receives. This ledger keeps track of all his expenditures and income (including those that owe him money for his services). Fortunately, for those that owe him money, he has no mob ties. He's actually quite a nice kid. But, if you don't pay him, he becomes like the paper boy in the late 80's movie "Better off Dead." Remember that kid? He rode around his bike telling the star of the movie "two dollars. I want my two dollars."
His ledger has taught him a few things:
1. He can't simply spend money when he feels like.
2. He has become quite adept at basic accounting principles.
Back to the tithing issue. The Bible is clear. Proverbs 22:6 says "Train a child in the way he should go, and when he is old he will not turn from it." One of the greatest things you can do for your children is teach them about the importance of the tithe. More importantly, teach them about cheerful giving. Help them get beyond the percentage. It's important not to simply tell them this, but to live it yourself. When we give generously to God's work, it's like telling God (and our children), "You know, Lord, there are a lot of ways I could spend this money. But I'm putting You first, ahead of my own desires."
I think this is the attitude that pleases our Creator, not the amount or the percentage. Giving opens the gateway to communication, whether to God, our mate or our children. It is one of the cornerstones for a better life.
Steve Scalici is a Certified Financial PlannerTM and Vice President of Treasure Coast Financial. He is co-host of a daily radio show called “God’s Money” which can be heard at www.oneplace.com. You can contact Steve at firstname.lastname@example.org or via telephone at 1-800-728-6342. His website is www.tcfin.com
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