Teach Your Children to Budget

My Story

I remember being a young teenager and asking my parents for some money. I can’t remember if it was for a school trip or if it was something else. But they told me they didn’t have it. Forty years later, I remember the dialogue that went through my head. “How do y’all work every week, get paid, and don’t have any money. That doesn’t make any sense.” When I said, that doesn’t make any sense, I was not thinking, “That’s a shame; y’all are broke.” I was thinking, “That doesn’t add up. You work every week. You must think I’m stupid. Of course, you have money. You just don’t want to give any to me.” I’m ashamed to even admit I actually felt that way, but it’s the truth. And tens of thousands of kids are probably having a similar internal dialogues because they (like me), don’t know what they don’t know.

Teach your children how to budget. Millions of young people enter adulthood clueless about basic money principles. I shared a little of my story, but you have your own story. The topic of money management/financial basics was not taught in most public schools, was not discussed by most of our families, and was shunned by our churches. As a result, thousands upon thousands of us, entered adulthood trying to figure it out for ourselves. We tried to do the math in our heads or on a piece of paper and were repeatedly perplexed as to why the numbers never worked out in the end. We always seemed to be struggling.

If you are joining me on a journey to make better decision, take your children with you. First, make sure you have built the muscle of budgeting yourself and then teach them.

Start Building the Foundation

Let them see real numbers (if they are mature enough to do so). This is a good time to talk about discretion. But, if possible, let them see your real budget. Use simple language they can understand and don’t overwhelm them. You don’t have to do it all in one sitting. But don’t underestimate their ability to understand. You may be surprised.

Budgeting is a tool they should master ahead of time, while they are still under your roof. If they can begin to put this in practice at a young age, it can mitigate some very costly mistakes in adulthood: strained relationships; ungodly stewardship; wasted money, destroyed credit, and drowning in debt; and a deep sense of guilt and shame. 

Let Them See

Sit down with them and let them see your budget. If you are using a budget app like I do, consider writing it out on a piece of paper so they can see everything on one sheet.  You can write, draws lines, circle key items as you talk about them, and highlight as needed. Show them, this is how much comes 

into our home and from what sources; and this is how we allocate that money so we are taking a balanced approach to spending. For example, we are using the 10-10-30-50 method. Ten percent we tithe/give; ten percent we save; thirty percent goes towards incidental spending, and fifty percent goes towards bills. Oh, and by the way, this is the difference between bills and incidentals. When things get tight, the incidentals category is the first place to start cutting stuff. Things always seem to come up, but our budget is limited. That’s why sometimes we have to say, no, when you ask us for money.

Talk it Out

Encourage questions; be open and honest. And ask questions to see if they are connecting the dots. Don’t try to teach them everything in one session. Sit down in another few months and reinforce what you talked about and build on that prior lesson.

As situations arise, use them as teachable moments. You don’t always have to whip out a piece of paper and a calculator. You’re just helping them apply what you’re teaching them to everyday situations.

Help Them Walk It Out

Teach them how to budget their own money. Maybe they are using a 10-10-80 rules. It depends. But teach them how to budget their allowance, birthday and Christmas money, and any other income they get. Teach them how to tithes at an early age. Teach them how to save as well. These will serve them well to have learned those practices early.

Teach them what the bible says about money; about greed and envy; about credit and debt; about tithing and charity; and about storing up treasures on earth and not in heaven. Teach them to look to Jesus, the Word of God, for wisdom and instruction.

When they enter adulthood, they may not feel comfortable disclosing certain things with you. For example, they may not want you to know how much money they make and what they spend their money on. But do your best to reinforce the good principles you have taught them. You have been open and honest with them, so maybe they will be with you. Either way, just help them talk out their increased responsibilities and their shift from a 10-10-80 to their own 10-10-30-50.  Prayerfully, at some point, they will master this. But be attentive to situations that signal if they have not. Ultimately, the ownness is on them.

Conclusion

Most parents want their children to have it better than they did. You may not have been able to set your children up financially, like you wanted. Perhaps you got a late start like I did. But one of the best legacies you can leave a person is wisdom and knowledge. Teach your children tools to help them lay a solid foundation that they can build on. Share your wisdom and insights. Teach them to honor God. That’s a legacy you can be proud of.

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