Dollars and Sense: Teaching Your Children About Money

by Sam Gray

There are a variety of things we will leave to our children when we are gone. Many of you probably think immediately of the money you’ll leave behind. I wouldn’t place money itself as the most important inheritance you’ll give to your children—but the skills and values involved in handling money and using it wisely are certainly among the greatest gifts you can give them. Like water to the earth, money can either nourish or destroy, depending upon how it is directed.

Money is not the root of all evil—in reality, it’s just a medium of exchange. So the proper use of money depends on one’s underlying values and habits. As a parent, you want to pass on a set of worthwhile values to your children, and what you teach them about handling money will help to do that. Depending on your own values and the way you regard money, you will be teaching them to be careful or slipshod, generous or stingy, wise or foolish.

Here are some suggestions to help your children establish a good foundation for using money wisely throughout their lives:

1. Give children an allowance and help them plan how to use it. Make helpful suggestions, but do not supervise too tightly. They should also understand from the beginning that when they are able to earn their own money, the allowance will be phased out.

2. Teach them to save for the things they want. Help them to open a bank account while they are young.

3. To the extent that you are comfortable with it, discuss some family financial matters with your children. Money should be neither a deep, dark secret nor the focus of your family life. Allow them to learn from your responsible habits with money.

4. Let children observe your generosity with money when you give to a church or charity, sharing with those in need. Learning to give away money wisely is as important as learning to save it.

5. Allow children to spend family money for the things they need, or handle payments at the grocery store or gas station. Learning the mechanics of money leads to confidence, and at the same time they are getting acquainted with economic values.

6. Teach children to earn their own money by honest toil. Money becomes a meaningful resource when you’ve worked for it.

7. When possible, allow children to observe investment and learn about the earning power of money.

Your success in passing along these skills and values will be a gift of great wealth to your children as they enter a world where money matters. Building the right habits and values will help them avoid the painful abuses where people cheat, steal and kill for money, or treat it as an end in itself. By contrast, you can help them attain and achieve what will bring a lifetime of satisfaction.

Sam Gray, father and grandfather, has worked men and fathers for over 40 years.

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