$20K before 18 -- part two (start early)

Establishing financial stability for beyond high school begins as soon as your kids have some understanding of money. Money, budgets, spending, credit, debt, savings, and giving should be part of normal conversation as soon as they are doing more than playing with their pacifier while you check out at the store.

Don't wait until they are too old to have "the talk" or it gets more awkward than necessary and they figure they can just rely on your money knowledge (and money) to get them through in the future. And, they are less likely to listen if you wait until their teen years to start these conversations. 

So, we learned to start early. We talk about money in everyday conversations. We explain credit cards and how money works. We chat about taxes and look at receipts together. It's never a lecture, not a school subject per se, and doesn't involve spreadsheets, calculators, or chalkboards. So much money is exchanged electronically these days that it takes a lot of intentionality on our part for our kids to see how we manage money. We just talk and ask questions and answer questions, and slowly help them form a healthy perspective of money.

Teach and model life skills. This involves mostly hard work. So few people have a true genuine work ethic. They might work for a reward or when they feel like it, but we tried to instill in our kids from a young age, the value of ordinary hard work. Honor people for a job well done. Take pride in chores and school work. Discourage laziness (in yourself and in your kids). This is definitely an area where more is caught than taught and I have to remind myself that we are raising future adults that look to me for the example.

Live out healthy financial habits. Talk about healthy habits (look some up, or read a book, like Dave Ramsey's if you need direction here). We boil it down to - set plans and goals, spend less than you make, honor God with every penny. Sometimes it is hard to be transparent with our kids, especially if we are struggling in an area, but as appropriate, help them see the issues you are sorting through as an adult and how previous decisions helped or hurt your current situation. They can learn from your mistakes and your successes.

Budget from the beginning. Giving, saving, spending. That's how their budgets started, using these handy banks with three compartments (now we use Family Mint to help them "see" their money at work). Every dollar that came in was allocated. If the money was a gift they still gave 10% first to the church. We encouraged another 10% to savings and they could spend the remaining 80%. Money that was earned (from chores, helping a neighbor, etc.) we teach them to save at least half, give a tenth, and the rest could be used as spending money. Somehow, along the way, most of them leaned toward saving more than that, and the money they set aside for spending often sits for quite a while before it is spent. Much of it spills over into their long term savings by the time high school rolls around.

Give and give some more. This is not a requirement that we have, but we do often speak about the joy of generosity. We have been on the receiving end at times as God carried us through lean times through the love of His people, and we have also been blessed to be on the giving end. If our kids are financially stable at 18 but harbor a stingy heart, we have failed. Giving is a core financial concept in Scripture and in our home.

Money is sooooo important. The love of it is the root of all evil. Money arguments rip apart countless marriages each year with most divorces attributing some or all of their source to money trouble. While our main focus with money is launching our children well as financially stable adults, this is an area that has life-long implications, and it all starts when they are young.