Randy Alcorn, Director, Eternal Perspective Ministries

Randy Alcorn lists ten ways to teach your child to manage money. These principles are fundamental for helping our children to lead the lives they were meant to live. Read the unabridged article at www.thegoodsteward.com website.

1. Give your children something greater than money—your time. Our children won’t remember what we did for them nearly as much as what we did with them. I’ve never heard anyone complain, ?Dad was always around, but I never had enough material possessions.? I’ve heard many lament, ?I had lots of stuff, but Dad was never there for me.?

2. Use life’s teachable moments to train your children. Deuteronomy 6:6-9 tells fathers to impress God’s commands on their children and ?talk about them when you sit at home and when you walk along the road.? When we’re alert, life brings countless opportunities to teach our children an eternal perspective on life, money, and possessions.

One night my daughters asked me to play a popular board game called LIFE. One of my girls was disappointed when she landed on a space that made her a teacher rather than a doctor or lawyer—even though she really wanted to be a teacher! Why the disappointment? It meant she would receive a lower salary. And money, after all, is what LIFE (and for many people life) is all about.

In the game you can choose whether you will have children or not. Because there’s a minimum amount of money but no minimum amount of children required to win the game, my girls kept choosing money over children. When I chose children instead of money, it surprised them, for that might mean my losing the game.

The event turned out to be an excellent teaching opportunity. I shared Scriptures with my girls that demonstrated infinitely higher regard for children than money, and how ?winning? and ?success? are very different in God’s eyes than the world’s. Next time they played the game, I noticed they made decisions that would make them ?losers? by the game’s standards, and winners by God’s.

3. Take a field trip to a junkyard. How can we teach our children the emptiness of materialism in a memorable way? Take them to a garage sale and show them how things that people spent great amounts of money on are now sold for pennies.

Or, take them to visit a dump or junkyard. Show them the piles of ?treasures? that once were Christmas or birthday presents. Point out things costing hundreds of dollars that children quarreled about, friendships were lost over, honesty was sacrificed for, and marriages broke up over.? Tell them that nearly everything your family owns will one day end up in a junkyard like this. Read 2 Peter 3:10-14, which says when Christ returns the world ?will be destroyed by fire? and ?everything in it will be laid bare.? Ask them the ultimate question: ?When all that you owned lies abandoned and useless, what will you have done that will last for eternity??

What will survive the coming holocaust of things? The answer? Only God, His Word, and His people. Explain to your children how life should be invested in the eternal. Read Matthew 6:19-25, where Jesus says, ?Lay up for yourselves treasures in heaven.? Tell them ?you can’t take it with you,? but according to Jesus, you can send it on ahead!

4. Teach your children to link money with labor. Once I said we couldn’t go out for dinner because we didn’t have enough money. My youngest said, ?Just go to the money machine and get all you want.? This was a great chance to teach her money doesn’t just magically appear in a bank machine, but is earned through work—good, hard, and well-done work. Parents, we can show our children how to work, to make things, to sell them. We can show them how work can be meaningful and fun, as well as financially profitable.

5. Teach your children how to save. Children learn the value of money and the discipline of self-control through saving. We helped our daughters open savings accounts years ago. If your child wants a major item, say a telescope, help him make a plan to save for it over a period of six months. Help him think of jobs to accomplish his goal. If he sticks with it, buying the telescope won’t be an impulsive decision. And once he gets it, he’s likely to take good care of it.

6. Start them on a lifetime adventure of giving. We taught our children to tithe from the very earliest age (Lv 27:30; Mal 3:8-10). They often gave more, but that ten percent was untouchable. If Grandpa gave them ten dollars for Christmas, the question wasn’t ?What can I do with ten dollars? but ?What can I do with nine?? The other dollar wasn’t theirs—it belonged to God. The holy habit of giving is like the holy habits of Bible study, prayer, witnessing, and hospitality. These habits need to be integrated into our lifestyle. Children raised in giving families would no sooner stop giving than brushing their teeth.

When we make decisions to give sacrificially we need to include our children so they can both learn and get in on the blessing. Once we received a large, unexpected sum of money from book royalties. We sat down with our children and discussed what we could do with the money. I explained we could use it to feed hungry people and reach them with the gospel. I also pointed out the money would pay for a two-week Hawaiian vacation for our family. We asked our girls what they thought. They enthusiastically encouraged us to give it to help the poor and lost?.

7. Provide your children with financial planning tools. When the girls were five and seven, I gave each three jars labeled ?Giving,? ?Saving,? and ?Spending.? I explained that every time they received money, they were to first put at least ten percent into the giving jar for their offering, then distribute the rest between the other two jars as they wished. Once they put money in the giving jar, even beyond the tithe, it was dedicated to the Lord and couldn’t be used in some other way.

And when they put money in savings, they were not to take it out and spend it on anything impulsively, but reserve it for something special. They were free to transfer money from savings and spending to giving, or from spending to savings.

I’ll never forget that night. They were so excited they immediately took the money and put it in the jars. They arranged the jars on their dressers, and spent two hours figuring things out. My seven-­year-­old asked me to show her how to do percentages on our calculator. She broke down her one-dollar-a-week allowance and wrote on the jar labels, ?Giving: $.25 a week,? ?Saving: $.25 a week,? and ?Spending $.50 a week.? For the next five years, this simple system resulted in more financial education than any single thing we did.

Remember, a child cannot learn money management unless he has money to manage, and unless he earned that money himself. (Otherwise he’s giving or spending his parents’ money, not his.)

8. Teach your children how to say ?no.? Few things we teach our children are as important as the discipline of saying ?no.? We must model the principle of delayed gratification, and teach the value of avoiding spending when the money could accomplish a higher purpose if given away, saved, or used more wisely. God commands and commends self-control as one of the highest Christian virtues (Gal 5:22-23; Ti 2:1-12).

By nature, children are impulsive spenders and need our help to develop sales resistance. Every time we say ?no? to our child about ice cream or a new toy, we can teach him there are higher values than immediate gratification. Self-­control learned in one area often carries over into others. A child who learns to say ?no? to unnecessary purchases is much more prone to say ?no? to sexual immorality or drugs.

Of course, stinginess is as negative as careless self-indulgence. Our goal is not to be ?penny-pinchers,? fretting over every expenditure, but joyful, responsible, and generous stewards.

9. Show your children how family finances work. Bring home a paycheck in one or ten dollar bills. Or use play money in an amount equivalent to your paycheck. Put the money in piles to show exactly how much goes to what expense each month. This way your children can visualize where the family’s money goes.

Some things will surprise the children and they’ll ask you questions. You’ll probably end up reevaluating and making some healthy changes your-self?. Your children may see things in perspective for the first time.

10. Never underestimate the power of your example. Albert Schweitzer said, ?There are only three ways to teach a child. The first is by example, the second is by example, the third is by example.? Whether consciously or not, we contin-uously train our children, engraving our values in them, as if drawing with a stick in wet cement. Children learn most effectively not just from what we say, but from what we do. Our actions speak louder than our words.

When it comes to handling money and possessions in light of eternity, the most important point is this: sometimes our children will fail to listen to us; rarely will they fail to imitate us.

Want to read and know more about Eternal Perspective Ministries? Visit their website at www.epm.org!

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July–September, 2003

Family Finance