Each generation is responsible for passing on the Gospel message and the truths found in the Scriptures to its children. "Train up a child in the way he should go, even when he is old he will not depart from it" (Proverbs 22:6). Since parents are the primary teachers of their children, especially during their early years, they should be the ones to instill within their children God's principles of finance as detailed in God’s Word.
Methods of teaching
Generally, parents spend from 18 to 22 years preparing their children for life and adulthood. However, they usually spend only a few hours teaching them the value and use of the money they will use throughout their lives and how to handle that money according to God’s established principles.
In order to teach God’s principles of finance and how to handle money, parents should use three methods: communication, example, and application.
Communication. "These words, which I am commanding you today, shall be on your heart. You shall teach them diligently to your sons and shall talk of them when you sit in your house and when you walk by the way and when you lie down and when you rise up" (Deuteronomy 6:6-7). Parents need to use the Bible and show their children God’s principles of finance as they are found in His Word. In addition, they need to communicate verbally with their children and teach them the scriptural ways and means of handling money.
Example. In addition to the study of God’s Word and verbal instruction, parents must also "practice what they preach" by being good examples. Because children are so impressionable, they easily recognize and adopt their parent’s attitude toward money. Therefore, parents must be godly role models on how to handle money. "Everyone, after he has been fully trained, will be like his teacher" (Luke 6:40). In other words, parents can verbally teach what they believe, but they reproduce who they are and what they live.
Application. Children need to be given the opportunities to see how God’s financial principles are applied in the lives of their parents and need to be given the opportunity to apply them themselves. The best model for children is for them to see their parents actually applying God’s principles of finance in their family life. Then the children can see that the family is blessed and family needs are met because scriptural principles are followed.
Areas of teaching
There are certain areas of financial teaching that parents need to adopt as their primary focus: income, budgeting, saving, debt, tithing, and giving.
Income. As soon as a child is ready for school he or she should begin to receive an income to manage. Whether that income is earned or given as an allowance is a decision that must be made by the parents. Whatever the choice, parents need to begin to instill within their children that boundaries must be placed on how money should be spent and that spending must not exceed income. In other words, encourage them to discipline their spending to remain within their income, discourage them from borrowing, and impress the need to save and accumulate in order to buy.
Budget. As soon as children begin to receive income, they should be taught how to divide that income into categories and to budget. The categories may be as simple as saving, spending, and giving. Whatever the case, encourage them to budget and not to spend their entire income on personal desires just because they have it to spend.
Saving. Children should be encouraged to save regularly a portion of their incomes and not to deplete their savings when they want to buy something that they feel they need. Saving must be ongoing and if any of it is withdrawn and spent it should be replaced. Eventually they should be taught the difference between emergency savings, long-term savings, and investment saving.
Debt. Parents need to teach their children the cost of borrowing and how difficult it is to get out of debt once they are in debt. They should be encouraged to stay out of debt and to purchase with cash whenever possible.
Tithing. Parents must instill within their children from the very beginning the mandatory necessity of tithing to the Lord and help them understand that this is a principle that must not be compromised. The first part of any and all of their incomes must be tithed to the Lord—before personal purchases, savings, or recreation.
Giving. In addition to tithing, parents need to encourage their children to set aside a certain amount of their incomes to help people in need, such as missions or special humanitarian projects or to purchase or give items for the benefit of others.
Since parents should be the primary instructors of their children, biblical principles of finance and how to handle money is an area of instruction that must not be neglected. However, it will not come naturally. Parents must make financial training a priority, and they must discipline themselves to be consistent in their instructions and in their example.