Teaching Kids about Finances

We have had many mentors over the years teaching Lisa and I how to teach our kids about money. Richard and Linda Eyre, Dave Ramsey, and his daughter Rachel Cruze just to name a few. But our best mentors on this subject were our Dads.

Chris’ childhood financial history

My Dad taught me at a young age how to earn money and what to do with that money. I did a lot of babysitting. I also became the neighborhood lawn mower, usually having about 5-6 clients. With my savings from that, my Dad and I purchased a much nicer lawn mower which made my job easier and more efficient. We both contributed $300 to that purchase. I started working for my Dad’s roofing company during the summer at about age 13 or 14. At first, I would just be the garbage boy, cleaning up the garbage on the roof, but eventually I learned the trade and this became a well paying summer job for me throughout high school and college. As a 9th grader, I would leave basketball practice and go straight to the mall where I would fly white styrofoam planes that would do a big loop in the air and then come back to me, trying to entice customers to stop and purchase the planes. I also worked in the food industry at Arby’s and at Chin Wah, our favorite Chinese restaurant, during High School.

How did my Dad teach me to manage finances? Whenever I made money, 10% of my income went to pay tithing, 50% went into savings, and I was free to spend 40%. Because I was taught this at an early age, it just seemed like normal practice and was never hard. We have instituted the same practice with our kids and it has been just as successful in helping them learn how to manage money.

Lisa’s childhood financial history

Lisa’s Dad worked for an insurance company in Vancouver Canada and he “hired” his wife and kids as the janitorial service to clean their main office. This meant the whole family had to go to the office 2 evenings a week to thoroughly clean it. He paid each member of the family $10 every time they participated, with the same breakdown described above with $1 going to tithing, $5 going into savings and $4 for them to spend. Lisa and her siblings would add up how many times they cleaned the office at the end of the month to know how much spending money they had. Their savings money added up quickly and this money was used for college, missions, and in some cases even helped to pay for kids braces. Lisa and her siblings also participated in a lot of other money making opportunities as children, selling home made suckers at school, selling popsicles at the local baseball field, having a paper route, etc. When Lisa was older and finished school for the summer, her full time job was to go and find a job for the summer until she was successful. Lisa learned from an early age how to work hard and earn money.

How did her Dad teach her to manage the money she was making? Let me introduce the infamous Blue Book. I think it was called the Blue Book, because it was blue? This was essentially a bank statement booklet that allowed Lisa to keep track of how much money she made, how much she owed for tithing, and how much she was going to save. When we started instituting the Blue Book method with our children, Lisa was adamant that it be an actual blue book. We created a spreadsheet with columns for Date, Description, Amount, Tithing, Savings, and Spending. The kids write in how much money they made and do the math to determine the total for each category. Lisa and I act as the bank for the kids, taking their money and then paying for their tithing and transferring money into their savings accounts. Then when they decide to spend some of their money, we pay for it and they deduct that money out of their blue book.

This system has worked great so far. Thanks to our Dads methods, our children have learned how to work hard and how to manage their money.