Summer is a natural time for kids and students to earn some money. Whether it is getting a summer job, mowing lawns in the neighborhood, or setting up a lemonade stand, summer provides great opportunities to improve one's financial position.
As a kid, earning money is an incredible thing. Without the demands of a mortgage, utilities, and groceries, one's mind begins to run wild at how to spend all of this newfound gain. For some, they may have to pay for things like car insurance and gas, but mostly the idea of Starbucks, movies, and eating out dominate spending.
It's interesting to talk with people about money. You can determine rather quickly whether they are a saver or a spender. For some, they can't spend their money fast enough. It takes hard work to earn it and seems almost effortless to spend it. For others, they are very careful and almost don't like spending money. They recognize how hard it was to earn it and don't want to give it away too easily. They aren't comfortable if they don't have a "cushion" stashed away in their bank account.
Teaching our kids how to manage, steward, save, and spend money is an important piece of their discipleship process. We don't often think of money this way, but how we handle it matters. Everything that we earn ultimately has been given to us by God. He has given us the ability and the opportunity to make the money we do, so how we handle it is an issue of the heart.
I am thankful that my dad was intentional with me about money. I will readily admit that I didn't always follow his advice and have made a lot of mistakes over my lifetime, but I am very thankful for his instruction. My dad taught me that anytime I earned money (as a kid), I should allocate it as follows:
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40% - Long Term Savings
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30% - Short Term Savings
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20% - Spending Money
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10% - Tithe
For every dollar that I earned (this didn't include money that was given to me as a gift), 40 cents went into the bank for long-term savings. This was set aside for a large purchase or need that would occur sometime down the road. My dad made me a deal that when I was 18 he would match my long-term savings amount in order to purchase a car. (I bought a used 1988 Volvo 740 GLE. That thing was a boat!) Long-term savings was money that I knew would not be touched until it was time for a large, important purchase.
Thirty cents of every dollar went into the bank as short-term savings. This was money that I could use to save up for things I wanted to buy for my pleasure. It could be for a new bicycle, a new stereo, or maybe for a cool pair of basketball shoes. You get the point.
Twenty cents of every dollar never saw the bank. This was cash in my pocket. I would use this to go out with friends to the movies, grab a bite to eat or take my girlfriend out on a date. Today, money is mostly handled electronically. I will say, there is something about using cash. Swiping a debit card doesn't have the same effect in how you view your money as pulling it out, seeing how much you have, and handing it over to someone.
Ten cents of every dollar would always go to the church. This was such a good lesson that taught me to recognize where my money came from, to be thankful for it, and to give it back to God for the ministry of the gospel. Had I not done this at a young age, I may not have developed the habit that continues to this day. It also radically changed how I viewed money.
This is just one example of how you can teach your children to steward their money. The key is to talk with them about it and come up with a plan that makes sense. I know what my tendencies were as a child: spend, spend, spend! I would say that fits the mindset of most kids when it comes to money. They might not like the idea of setting some aside and giving some away at first, but it will pay off in the long run with habits and a mindset toward financial health and God-honoring stewardship.