Like so many other topics in life the subject of money eventually catches our kids’ attention. After years spent riding in the seat of a shopping cart they’ve seen a magical process take place, again and again. Apparently you can walk into a store and take anything you want, as long as you give the nice lady at the cash register some money. And sometimes even that isn’t necessary; you can just slip a card through a little machine instead.
There’s a documentary called “Beyond the Gates of Splendor” about five missionary men who were killed by members of the Waodani people in Ecuador in the late fifties. The story of how their families turned that tragedy into a triumph is powerful. Toward the end of the film, Steve Saint, son of one of the missionaries, brings the man who killed his father to the U.S. He now calls him grandfather. Upon his return to Ecuador, Mincaye tells his fellow tribesmen about a wondrous place in the states called a supermarket. It is an enormous room filled with enough food for a whole village, and it is all free for the taking. Steve corrects him, assuring the tribe that he did pay for the food.
“Remember, grandfather? I gave her that little card.”
“Ha! That is true, grandson. But she gave it right back.”
Commerce can be mysterious to the uninitiated. It’s really no wonder that our kids are disillusioned and disappointed when we tell them they can’t have something at the store. They just don’t understand that there is a limit to the seemingly inexhaustible supply of money their parents seem to have.
Since we were raising men, we decided that our sons needed to understand the connection as early as possible. Beginning at about age 4 we paid each of our boys an allowance. They received a dollar a week for every year of age. Every birthday they got a raise. Each week the money was distributed among five labeled cans on their dressers:
- Tithe (10%) This can was emptied every Sunday and the money was taken to church.
- Taxes (10%) This money was allowed to accumulate until our family took a trip to places like Six Flags. Whatever they had saved up was their contribution to the trip. As they got older this contribution was sometimes significant, and they were justifiably proud of it.
- Short-term Savings (20%) This accumulated until they were invited to a birthday party, or needed a gift for mom on Mother’s Day. Whatever gift they wanted to give, they had to pay for. Karen kept a supply of toys and games she found on sale in our closet. If the boys wanted to, they could buy from her.
- Long-term Savings (20%) We set up a mutual fund for each of the boys through our bank. Periodically, this can was emptied and the proceeds were deposited into the mutual fund. When Gerrit got married last year, he withdrew a good portion of the money from his fund to help buy a car.
- Quick cash (40%) This is the money they were allowed to spend without restriction. They could save it up for a big thing, use it to supplement their short-term savings to buy a nicer gift for their friend, or just waste it. Many choices.
It was hard sometimes to watch the boys spend their quick cash frivolously, but experience is a great teacher and we tried not to interfere with the process. It worked to our advantage. If we were at the store and the boys found something they really wanted, all we had to do was ask them if they had their quick cash with them. If not, so sorry. Once Tucker bought a huge box of his favorite gum, draining his quick cash with one impulsive purchase. For years afterwards the phrase “Remember the gum!” was heard anytime one of the boys came up short for something they really wanted to buy.
As the boys got older, we adapted the system to lay more and more of the responsibility on them. As soon as they were able Karen let the boys do the distribution into the cans. When they turned twelve the cans were reduced to tithe, savings, and cash. Beginning in the ninth grade they were paid monthly, the cans disappeared, and they got their own checking accounts with debit cards. Managing it was all up to them, though we were able to keep an eye on their activity through the wonders of online banking.
When they started driving we required them to pay for all of their own gas and half the amount our insurance increased as a result of their being added to the policy. If they got a ticket, they paid for all of that plus whatever our insurance went up as a result. We got them cell phones on our family plan, but when they wanted fancy smart phones and data plans they had to pay the difference. They bought their own X-Box. When girls and proms entered their lives the boys paid for all their own tuxes, corsages, and tickets. Eventually they realized they were going to need jobs to supplement their allowance. Life gets expensive!
Managing money is both an art and a science. It can be really complicated.