Are your children learning biblical financial principles beyond the tithe? Most of what our children learn about money comes from us. Will they be prepared by the time they move away from home?
There are lots of ways to teach a child about finances, some of which I suspect you didn’t even realize you were teaching. Most of us have heard that our children do as they see us doing. And so, what is it that they see – and hear?
The first thing a child often hears is no. No, you can’t have that something or other. But unfortunately, we simply say no and only no when this is a perfect time to teach financial principles. For example, No, we haven’t saved up enough money for that yet. This opens up a whole conversation about savings, budgeting, needs versus wants and so on.
Saying no to a child also opens up the opportunity to discuss contentment with a child. This one is harder but use the word when talking to him or her. Remember, contentment must be learned!
But what are the essentials to teach a child? Here is my short list: Budgeting, Tithing, Saving – that’s it! Through these three fundamentals all other financial concepts can be taught.
The most important financial principle to teach your children about is budgeting. The word budget has French roots and simply means your wallet. Therefore, a budget should be constrained to what you have in your wallet. (Think about that Capital One credit card commercial that asks: What’s in your wallet? Of course, they are suggesting that you have an unlimited supply of cash when you have it.) You can’t spend what’s not there and so you have to make choices on what you spend your money on.
Deciding how much money you are going to spend on goods and services is your budget, or said differently a spending plan. As such, it is great to have some targets for each category you might spend money on. Check out the Percentages Guides that Crown Financial Ministries suggest for different family sizes and life stages by clicking here.
When you look at these sample budgets, you will see the next important financial principle – the tithe. I will leave this topic to our pastors, but do notice that the tithe is a most important element in determining how much money you have in your wallet.
Finally, we come to savings, which must be budgeted for as well. Savings is nothing more that future spending. Teaching saving helps teach patience, contentment, avoiding debt, planning for the future and so much more.
But the whole process begins with budgeting! Without budgeting, you don’t have a plan. And if you don’t have a plan, well it’s like the wise saying: “If you fail to plan, you plan to fail.” Or maybe more encouragingly: "Plan Purposefully. Prepare Properly. Proceed Positively. Pursue Persistently."
So, do you have a budget and talk – so that your children hear you – about your budget? Do you make tough choices with your budget in mind and talk so that your children hear you? Do you put money into savings for future expenses and talk so that your children hear you? Get the point?
Have you learned contentment so as to teach your children about it? Do you tell yourself no? Do you postpone spending to a point in time that you have saved up the money to make the purchase?
Do you have a savings account that you talk about using for big purchases or retirement? Do you have a family savings plan? For example, have you all agreed that saving for a vacation is important and therefore say, "we all have to plan to spend less so that we can save more for that big vacation." (By the way, this is one of the best ways I have found to drive home all of these points – a vacation that everyone wants to go on and therefore everyone participates in the plan to make it happen.)
Bottom line: Your children need to see & hear you practicing sound financial principles so that they can learn.
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