Profitable Ideas: Preparing for a Downturn, Giving Kids More Financial Freedom, and More
August 25, 2017
4 Comments
Karen Howard
on August 26, 2017 at 11:14 AM
Regarding the article on allowing children financial freedom, we did that with our daughter. Other than a requirement that she tithe and also save a certain percentage, we allowed her to make as many of her own spending decisions as were appropriate for her age. In the early years (elementary and below) her allowance was fairly small and covered tithe, savings, and miscellaneous ‘fun’ spending (toys, books, etc.). Starting in junior high, each year on her birthday we added a category of budget spending (entertainment, clothing, etc.) to her allowance and transferred the responsibility for her share of those purchases to her. By the time she was a senior in high school (in 2010) her allowance was $300 per month but she was doing her own purchasing for everything except housing/groceries (including her share of eating out with us!). None of the typical teenager routine of asking for money to go to a movie with friends, or asking for trendy but expensive clothes. She learned so much about comparison shopping, avoiding impulse buying, how to split the bill when eating out with others, how to calculate a tip, making money last until the next month’s allowance, and so on. Now she is through college, worked for a few years, and has returned to graduate school, has no debt, and is still a wise spender. We highly recommend this approach to training kids to be financially responsible adults. I don’t understand why anyone would send their kids off to college or the work world to manage money on their own without any actual, real-world practice!
As a side note, before she went off to college we also had her manage the family finances (with supervision, of course!) for a few months so she could see what it really costs to live as a family, how to pay real bills, and so on. This level of financial transparency as parents may not be comfortable for everyone, but knowing it was coming in our plan for her financial training helped us make a few better decisions than we otherwise might have made – a good accountability step for us as the adults!
Regarding the article on allowing children financial freedom, we did that with our daughter. Other than a requirement that she tithe and also save a certain percentage, we allowed her to make as many of her own spending decisions as were appropriate for her age. In the early years (elementary and below) her allowance was fairly small and covered tithe, savings, and miscellaneous ‘fun’ spending (toys, books, etc.). Starting in junior high, each year on her birthday we added a category of budget spending (entertainment, clothing, etc.) to her allowance and transferred the responsibility for her share of those purchases to her. By the time she was a senior in high school (in 2010) her allowance was $300 per month but she was doing her own purchasing for everything except housing/groceries (including her share of eating out with us!). None of the typical teenager routine of asking for money to go to a movie with friends, or asking for trendy but expensive clothes. She learned so much about comparison shopping, avoiding impulse buying, how to split the bill when eating out with others, how to calculate a tip, making money last until the next month’s allowance, and so on. Now she is through college, worked for a few years, and has returned to graduate school, has no debt, and is still a wise spender. We highly recommend this approach to training kids to be financially responsible adults. I don’t understand why anyone would send their kids off to college or the work world to manage money on their own without any actual, real-world practice!
As a side note, before she went off to college we also had her manage the family finances (with supervision, of course!) for a few months so she could see what it really costs to live as a family, how to pay real bills, and so on. This level of financial transparency as parents may not be comfortable for everyone, but knowing it was coming in our plan for her financial training helped us make a few better decisions than we otherwise might have made – a good accountability step for us as the adults!
Thanks for sharing your experience, Karen. I’d like to try this idea with our kids and your note helps affirm how effective it can be.
I agree and resonate with what the Ron Blue Institute had to say. Not that I am good at it, but I want to move in that direction.
Such a great challenge, isn’t it? To put money in things that make us treasure God more.