How to Raise Financially Confident Kids

Whitney Hopler

Editor's note: The following is a report on the practical applications of Mary Hunt's book Raising Financially Confident Kids (Revell Books, 2012).

You likely invest a great amount of effort into your children’s spiritual and academic education. But how much have you taught your kids about managing money?

It’s important to give your children a solid financial education, since money will be a vital part of their life as adults. If your kids reach adulthood without financial confidence, they’ll be vulnerable to falling prey to the pressures of the advertising and credit industries, which have led too many people into lives burdened and damaged by debt. But if you teach your kids how to manage money well – while they’re still living under your care – you can give them the confidence they need to live with financial freedom.

Here’s how you can raise financially confident kids:

Teach your kids about giving. Explain to your kids that all the money your family has ultimately comes from God, and that God wants you all to express your gratitude and learn how to love in generous ways by giving the first 10 percent of your income regularly to His kingdom work, plus more beyond that whenever He leads you to help people in need. Talk with your kids about the various ways you support your church, charities, and other organizations or people. Let them see how the money your family gives is helping others in tangible ways. Encourage them to start giving a portion of their own money to help others as soon as they can, and to choose the specific ways in which they want to help.

Teach your kids about saving. Let your kids know that it is important to save some of the money they have for the future rather than spending it all – and if they do so faithfully, they’ll never be broke. Explain the concept of compound interest to them, so they can see how much their saved money can grow over time.

Teach your kids about spending. Tell your kids that it is crucial to set spending limits to avoid the dangers of debt, and that they should never spend more than they earn. Urge them to keep track of where their money goes. Teach them how to create a budget to plan how best to spend money each month. Encourage them to distinguish between what they want and what they need. Show them how to shop wisely and buy only what they’ve planned to buy. Help them create and maintain a budget. Model a healthy spending lifestyle to them by living below your means as a family. Let them know that you can afford to buy more, but are choosing not to spend on what you don’t really need and to make thoughtful decisions about what you want. Limit the time you spend shopping and invest your family’s time into more productive activities. Counteract attitudes of entitlement by expressing gratitude on a regular basis and encouraging your kids to do the same.

Teach your kids about borrowing and credit. Explain to your kids the importance of avoiding borrowing money if all possible, because the interest they will have to pay on borrowed money is rarely worth it. Let them know that it’s wrong to ever take out unsecured debt. Teach them that they should never borrow money for something that will lose its value quickly or be used up in less than three years, and that they should repay any money they’ve borrowed as soon as possible. Aim to live a debt-free life as soon as you can so your family can enjoy the benefits and your kids can experience the wonderful freedom that comes with a debt-free lifestyle. Avoid credit card debt by paying your balance in full each month, and pay off any other debts (such as your mortgage and car payments) as quickly as possible. Neutralize the glamour of credit card marketing pitches by talking with your kids honestly about the many pitfalls of using credit (such as high interest rates) and the benefits of simply using cash. Explain what a credit report is and why it will be important for them to check the accuracy of their credit reports as adults. Recommend that your kids have only one credit card that they use to build a solid credit history (never as a tool to buy things they don’t have the money available to pay for). Explain that they won’t really own what they buy on credit until they fully pay their bills.

Give your kids information about the financial products and services they’ll encounter after leaving home. Prepare your kids for dealing with the financial marketplace once they grow up and live independently from you. Inform them about such financial concepts as credit cards, checking and savings accounts, ATMs, insurance (auto, home, health and life), mortgages, Social Security, and mutual funds and other investments.

Assign a portion of your family’s financial resources to each child to manage on his or her own. When each of your children reaches sixth grade, give them a monthly salary that becomes theirs to manage. Set an amount that is at least enough to cover each kid’s monthly expenses for which you would normally pay out of your own pocket (from clothing and school lunches to birthday party gifts and comic book purchases). As your child grows older, increase the monthly salary amount to gradually turn over more responsibility and prepare him or her for becoming financially independent of you as an adult.  Give your child a list of specific items that are now his or her responsibility to pay for, using the monthly allowance. Then give your child the freedom to make his or her own spending decisions, as long as he or she respects your family’s values and rules. Require your child to give away 10 percent of his or her monthly salary – soon after receiving it, to whatever organization or people in need that your child chooses – and also to save or invest 10 percent of the monthly salary in a bank or investment vehicle that you approve. As your kids make their own financial decisions each month, they’ll grow in both wisdom and confidence. You can then take them off the salary plan after they graduate from high school and require them to get a job to pay for their expenses while in college and later.

Adapted from Raising Financially Confident Kids, copyright 2012 by Mary Hunt. Published by Revell Books, a division of Baker Publishing Group, Grand Rapids, Mich.,  

Mary Hunt is an award-winning and bestselling author, syndicated columnist and sought-after motivational speaker who created a global platform that is making strides to help men and women battle the epidemic impact of consumer debt. She is founder and publisher of the interactive website Debt-Proof Living, which features financial tools, resources, and information for her online members. Her books have sold more than a million copies and her daily newspaper column is nationally syndicated through Creators Syndicate, and is enjoyed by hundreds of thousands of Everyday Cheapskate readers. Hunt speaks widely on personal finance and has appeared on shows such as Good Morning America, Oprah, Dr. Phil, and Focus on the Family. She and her husband live in California.

Whitney Hopler is a freelance writer and editor who serves as both a contributing writer and the editor of’s site on angels and miracles, at: Contact Whitney at: to send in a true story of an angelic encounter or a miraculous experience like an answered prayer

Publication date: July 11, 2012