Wednesday, April 20, 2011

There's the Money!

I told the kids in my group (see "Where's the Money?" below) to consider going home and asking for time to talk with their parents about what they learned this day. With their new awareness of how to set a budget, the time seems ripe for them to practice this new skill. I told them to ask their parents to consider giving them a monthly allowance; from this allowance they would set their own budgets for the month. Imagine your kids not asking you for money for every little thing. Imagine kids who enter college knowing how to budget, save and not go into debt. Imagine a next generation of leaders who understand living within their means.

Kyler's Budget System
For over ten years our kids have been receiving these funds. When they receive their budget amount they have to sit down and put each dollar into envelopes or categories. When they were very young, the categories were simply Tithe, Saving and Spending. The tithe was to go to the church. The spending was at their discretion - if we were checking out at the grocery store and they wanted a pack of gum, they could buy it with their money. The saving was long term, we told them once it entered the saving envelope it wasn't coming back out, it was to go to the bank for their future education and vehicle. Any additional income from babysitting or lawn mowing must go through the budget process.This system has given our kids freedom to spend and responsibility to save.

Today, Kyler still keeps envelopes, but the other kids have evolved to budget spreadsheets. Their categories have expanded beyond the three basics, they now include categories such as:
  • Vacations - for their own discretionary spending while on family vacations.
  • Presents - for friends.
  • Football - we allot Zach an amount each year to spend on new gear, because his taste is of the very high end, the amount we provide doesn't meet his wants. He saves some of his money all year to supplement what we give him for football.
  • Shoes - again, we allot an adequate amount for new shoes each year - if they want $100 shoes, then they have to make up the difference.
  • Lunch - I budget an amount each month for school lunches, if they want more than that, they are responsible for that amount.
  • Clothes - this also allows them room to spend beyond what I budget for them. Recently we were at the Chris Tomlin concert and Zach and Erin both wanted a t-shirt, neither asked if we would purchase them, they simply bought their own.
Erin's Budget Spreadsheet
A few years ago Zach decided we should have a PlayStation 3; we have a PlayStation 2 which worked fine. So he added a PS3 category to his budget plan and one day approached us to ask if he could purchase a PS3; the answer was yes. Erin purchased her own i-Pod last year, and after six months of saving, Kyler is $23 dollars away from purchasing a DS for $129.99 (plus the $9.00 in sales tax).
I am passionate about teaching our kids how to budget. I don't want them to live under the oppression of debt (as Kevin and I did early in our marriage). I want them to be wise with their money today, and more importantly ~ tomorrow.


  1. Great parenting! I would vote for you as "Mother of the Decade!"

  2. I wish you would have been writing when my kids were little ~ I really could have used your wisdom and insight.

  3. Ooh, this is SO good, too! We started doing Financial Peace, Jr. with the boys, and they both have commission worksheets.... payday is on Sunday nights.... and it is working SOOOO well!! A little added note: One of the things that "Dave" says in the parent training tool included is that we are preparing our kids not only for healthy, financial living as adults BUT ALSO, for a HEALTHY MARRIAGE as SO many disagreements in marriage are caused by money issues and lack of balance in the area. I had never thought about the marriage component before, but I thought that was so, so good!


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