Financial Parenting

Print Friendly

Guess where I picked up a copy of Financial Parenting: Showing Your Kids That Money Matters by Larry Burkett and Rick Osborne?  If you have been a reader for more than a day, you would probably know that I never pay full price for anything.  I picked it up at a local second hand store for 50 cents.  Yes, I do practice what I preach (here is where I suggest: 10 things you should always buy second hand).  Money well spent!  Having three kids and being a fan of the late Larry Burkett, I was excited to get into this book.

The purpose of the book is to equip parents with the tools necessary to pass along a biblical concept of stewardship to their children.

Photo by Daquella manera

Here are a few of many important lessons I learned from reading Financial Parenting: Showing Your Kids That Money Matters

  1. Family finances should be easy for everyone to see and monitor. The authors recall a time when the family finances were open to every member of the family.  If the crops were producing less in a given year, the entire family could see the shortfall and the entire family would adjust their spending accordingly.  Now, however, most family discussions about money occur once the kids are in bed.  We prefer to shield them from the true reality of our finances.
  2. The immediate connection between work and money is gone. Farms provide vivid illustrations for the relationship between work and financial increase.  Now, however, dad and/or mom disappear for eight hours and come home with groceries.  Money grows in machines and groceries are purchased with little square plastic cards.
  3. Children are learning to borrow instead of purchase. These lessons are coming from parents and from a entitlement mentality promoted by government regulations.  When a teenager begins considering school, the first question they ask is, “Where do I go to get a loan?”  When it comes to buying a vehicle, we wonder how to get approved?
  4. A good example was the G.I. Bill.  It promoted a big shift from the attitude, “If you can’t buy a house, you can’t afford it,” to “If you can’t buy a house, the government will back your loan for it, and now you can afford it.” Burkett and Osborne.

  5. Some young people can get rich quick so all young people try to get rich quick. Life on the farm presented few short cuts.  Now, you can come up with one great idea and make enough money for a life time.  The glamour of creating a multimillion dollar concept is much more appealing than sweating away in an office for 40 years.  So the young look past traditional forms of earning in exchange for much more illusive pursuits of wealth.

So what can be done?

Start by laying a solid foundation based on biblical principles. Rules without context are oppressive to children.  Teach them what to do after you have laid out the principles to guide them.  Here are three principles I picked up from the book:  (a) God is our provider, (b) Christians learn to be content, (c) When dealing with finances honesty is still the best policy.  This way when you teach your children about giving it will be based on the foundation that they already know – God is the provider.

Openly communicate with your children about your current financial reality. Make it age appropriate.  Don’t be embarrassed to say, “We can’t afford it.”  Don’t be ashamed if you need to give a few less Christmas gifts.  If you shield your children from reality you teach them to spend regardless of what they earn.  If things are going well at work, openly thank God that he has provided the means necessary for your family to do certain activities together.

Give your children jobs. For Christmas 2008 we gave our 3 1/2 year old daughter two things.  The first she really enjoyed.  The second fizzled out quickly.  The first thing we gave her was three clear jars that my wife decorated with the words: save, give, spend.  The second thing we gave her was a job.  She was responsible for turning on the lights at night and turning them off in the morning.  Every time she did the job we gave her 20 toea (currency of PNG where we live).  She would take the money and on Monday and Thursday, she put money in the save jar.  On Tuesday and Saturday, she put money in the spend jar.  On Wednesday and Sunday, she put her coin in the give jar.  On Friday she could choose any of the jars.  She did a great job with the jar for about two weeks and then she quit because it was too hard.  So we let her – and we stopped paying her.  About three weeks later she wanted money to give to church so she resumed her post again.

Teach your children important principles about saving. Always encourage them to be actively saving a portion of what they earn.  Teach them that things are obtained by saving – not borrowing.


  1. says

    Understanding and realizing the power & importance of the disconnect between parents earning money, and then suddenly showing up with “stuff” is essential. Kids MUST be involved in the process! It is more difficult to do so in our modern age, but it is far from impossible.

    Take your child to work once a month. Show them what you do & explain how it pays for your home.

    Have them help you pay the bills and maybe even let them help pay for things out of their allowance. Help them create a budget for their allowance and show them where their money is going and how they are helping to contribute to the daily functioning of the home.

    All of these things remove the “disconnection” between children, parents, money, and the proper application of money.
    .-= Matt Jabs´s last blog ..One World Currency – New World Order =-.

    • Craig says

      @Matt Jabs. What you are suggesting follows the overall direction of the book. The more closely kids are involved in finances the more they learn. Don’t hid the finances from the kids, but include them. Thanks for you comment.

  2. says

    Number three really resonated with me, Craig. I know I am sounding like a typical old guy, but many kids DO have a little too much of good thing nowadays.

    I think the entitlement mentality is not just a product of the government, but many times also a product of the parents, who are always willing to give their kids everything they ask – and more.

    Kids that understand the real value of money now will have less trouble in the future managing their finances as adults.

    My $0.02 (after taxes)

    Len Penzo dot Com
    .-= Len Penzo´s last blog ..Drive-By Movie Review: Gran Torino =-.

    • Craig says

      @Len You don’t sound like and old guy, but a young hip man with some knowledge. I would pay 3 cents for your advice any day :). As parents we do need to first learn to say no to ourselves and then saying no to our kids might be a little easier. Thanks for you comment!

Leave a Reply

Your email address will not be published. Required fields are marked *