Teaching Kids About Life and Money

Do you have children? I do and in my daily devotion in Proverbs. I came across this "Train a child in the way he should go, and when he is old he will not turn from it. - Prov 22:6".

How do we train in child in the area of life and money? I got my 'training' through observing my parents and that is one way. However, to accelerate this learning curve for them in this age, we have also shown our children in the mathematics of compounding, delay gratification, saving and giving.

I found this article by Dave Ramsey recently and am thinking about the applicability in our asian context. Feel free to comment.

Blessed day!

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Top 3 Kids and Money Q&A
Teaching Kids About Life and Money

Let parents bequeath to their children not riches, but the spirit of reverence. - Plato

Plato said it well. Parents are not just responsible for providing food, clothing, and shelter for their kids. They are also responsible for teaching their kids about life…and life includes handling money.

When it comes to kids and money, the three most common questions I get are:

• When should I start teaching my kids about money?
• Should I give my kids an allowance?
• When should my kids go to work?

Teach kids about money as young as pre-school age and no later than third grade. Just think about it: if your kids can grasp this money stuff early on, they’ll avoid many of the pitfalls later. After all, it’s better for little Billy to make a $10 mistake than a $10,000 mistake!

1. Start paying them a commission for chores they do around the house.

Typically, one dollar per completed chore is sufficient with a list of five or six chores each week. Remember that each child is going to respond differently. Just keep evaluating your child’s maturity level and make sure their chores are age-appropriate.

2. DO NOT give them an allowance.

After all, what are you making an allowance for? You don’t want to have the kind of kids who think money grows on trees, do you? Don’t set them up for frustration and unrealistic expectations. And don’t miss out on the teachable moments that come when you give them a commission instead of an allowance.

3. Send them off to work.

“Child abuse” is letting a kid sit in front of a TV all day playing video games and eating junk food. Kids need to understand what a little dirt under the fingernails means. Delivering newpapers, mowing lawns, or working at a concession stand are some appropriate jobs they can handle.

Guiding your children in the choices they make with money is HUGE! The lessons you teach them as they earn money and learn to spend, save, and give will lay an influential foundation for their lives. Remember, if you don’t teach your kids how to handle money, someone else will. Continue

Never buy on the spot

Ever been pressurised to buy things on the spot or leaving the supermarket with more than the shopping list? I have - we went to an agency to interview a person and almost end up hiring the person the spot.

That was a close call to not 'committing your actions/work to the Lord (Prov 16:3)'

Here is a article written by Mr Tan Kin Lian which I find interesting...........................



Never buy on the spot


Creative property consultants work hand in hand with developers to create false impressions. You can see them under different creative names in different forums generating waves to enrich themselves.

Some years back when I was looking for a property this agent with a big Mercedes Benz brought me to see a condo in the east. The way he conducted the sale he has a 95% chance of closing the deal at a high price. He was able to use tactics like high pressure sales to lure the potential buyer capitalising on the average human greed and fear.

Later when I was sitting in his Mercedes, he asked me what I do for a living. I told him I teach advance negotiation techniques to fortune 500 companies executives and he then muttered: "No wonder".

The simple advice to follow is simply this. Do not buy anything on the spot, there is no such thing as no more supply, only no more money. Determine your own price based on value, which you can determine after some basic research.

Do not go beyond your calculated price as agents will use your emotions to jack up the price. Always use the technique of having to consult your spouse to buy time.

Some agents know this and insist that both you and your spouse be present, ever wonder why time shares promotions always want you and your spouse to be present so you have to make a decision on the spot?

Just do not make a decision on the spot. Say you need to consult your father, mother or God, if necessary. Make it a philosophy never to make a spot decision.

Whenever I buy something, the sales agent will always ask for a deposit. I will tell them my philosophy is no deposit. They will then say what if someone comes along and buy the last piece. My answer is always: "Congratulations, I will look for another piece"

Remember, there will never be no supply, this impression is created by agents so they can pressurise you. There is only no money!

Insurance matters

In my journey as being a steward, I have recently been thinking about the area of insurance coverage.

Most if not all of us do buy insurance and we need it. But there are so many types of insurance out there and in most case, we will probably buy whole life insurance thinking it will be double as savings. However, through the regular insurance statements, the recent financial climate had eroded the 5-9% interest rate. Hence, it would be better to buy term as much as possible and invest the rest. This is applicable to Education insurance policy too. This I hope to pass down to my children so that they will learn and move forward.

Why buy term insurance?

It is for coverage purposes and has no investment return values. That's fine as we build our financial wisdom and gather little by little. Returns are higher as well as we are able to participate in certain corporate actions like rights issues which is typically under valued. For a small sum, we are well covered and can use the rest for investments.



Some adovcates:

Tan Kin Lian
From his website on Personal Insurance , he mentioned this about critical illness:

“There is no need to buy insurance to cover critical illness. Your Medishield or private Shield plan can cover most of the medical expenses.

The chance of making a critical illness claim is small. Less than 5% of people make this claim during their working life.

If you wish to have insurance to provide a cash payment, a sum of $50,000 should be adequate. The cost of critical illness cover is high. You should not spend too much premium on this risk, as the return is poor.”


Suze Orman:


Dave Ramsey: