Family and Finances: Episode 6, Part 2

You know, sometimes we're asked, did we shield our children from our financial challenges? And I would say, yes, we did. They didn't know the stress we were under, some of the mistakes we had made, some of the difficulties we were having. But we didn't waste it. We didn't sort of drag them into it. There wasn't drama around those issues. But we also used it to point out to them, there's a better way. And we really want you to know this better way. Well, yes. I think the hardest times were when our oldest two were young, and then we learned things along the way that we tried to implement with our young ones now. Well, everyone has a different personality and a different bent. And we have one that's more given towards spending. And just recently, you tried something new to try to get their attention on their spending habits. Well, yes. I got him a little notebook, told him to divide it into three sections, income, spending, and sacrifices, just to try to get him more aware of not spending and recording things like that he could pass up, like not stopping to buy fast food when he's hungry. Write it down, you know, and come home and eat. Just make him aware of how much he was spending. And how important it is to say no to yourself. Right. And I read a study years ago, I think it was by Duke or North Carolina, some of the highest achieving alumni of the business school. And they looked for the most common, lowest common denominator. Was it their grades? Was it their SAT entrance score? Was it their extracurricular activities?

And what they found is the most common denominator, lowest common denominator of all the high achieving alumni from the business school was that all worked outside the home by the time they were 13 years old. Oh, wow. And so the ability to integrate into the workforce and have experience and knowledge and know how to get along with people was the best predictor of future success in their top alumni. And you know, I look back on that and I think that's so interesting because that's when I started working outside the home, not that I've been a high achiever, but I had a job when I was 13 for a boss. I worked at an amusement park and I actually, you know, got myself to the job and logged in on a clock and had to take orders. And we tried to teach that to our children and get them ready. I remember one of our children got a job outside the home, I think he was 18, and the boss called me and said, I don't know what you've done, but you've done it right. Because this is one of the best employees of an 18-year-old I've ever had. We get also asked sometimes about what do we do when children earn their own money outside the home? Should they contribute to the home expenses? And the way we've always managed that is we just push things to them that they need to buy with their own money. And that's one way of contributing. Am I going to ask them to pay the bills? No. Am I going to ask them to pay a portion of the rent? No. But with one of our children now, what we've done has been working pretty well so far is we've said, you know, you've got a car, you've got a mobile phone, you've got insurance, you've got, you know, a pretty nice setup while you're in college. We would like you to start to pay that yourself. And he's able to do that.

He's living at home. Yeah. So essentially, he's getting free rent, but he's contributing to the overall cost by paying his own bills. And for him, it's about $350 a month. So he's basically working it off around the house. He has to either work it off in hours around the house or earn it outside the home. So that he's ready once he's through college to pay his own way. Well, and sometimes we're asked, should they contribute? Because there is a need in the home. You know, and I think everybody's circumstance is different. And I think you have to look at the child's heart. If a child wants to contribute, then don't deny them. You know, that's God. God will work through each child and each family in different ways. And one of my friends tells a story of living in a single-parent home. time he was 15 he was contributing to the monthly needs of the family just to have rent and groceries and went on to become a very successful entrepreneur because he was used to that responsibility. He was used to from a young person having to bear that weight in their life. I think our tendency in this culture is to shield them from responsibility and to not give them enough and to trust them with what they're able to really do. Well and I think there's also a desire not to reveal for embarrassment reasons. You don't want your you know other people to know you can't afford a birthday gift or wedding gift or whatever so you're you know don't want your kids to even know. Yeah well one of the big rules for us is we want our children if they chose to go to college that we weren't going to have any student debt. We just said that up front and so that meant a couple of choices. Number one we we wanted them to get scholarships so they had to work hard on their grades and be prepared for to apply for scholarships. Number two they might have to work during school

and contribute to some of their own expenses which surveys show that they do much better in school when they have a job versus just goofing around. And so we said we don't want you to borrow for a student loan and we're not going to borrow for a student loan and that's actually worked out really well for all of our children. We never put money in a 529 plan. One of the reasons we did that is we felt like it might be restrictive if the children decided not to go to school and want to start a business or go to a trade school or do something other than traditional education route. We saved and we were prepared for it but we didn't take advantage of that 529 plan and I would say you need to be pretty sure that your child is going to go into a traditional academic route and that there's enough tax saving benefit in your state or in your circumstance to warrant setting aside just for that purpose. Another issue I think families are facing today is not just dealing with their own children but now with their parents. By the way did you see the headline right now more children or adult children are living at home than during the Great Depression. There's more children back at home. So this idea of the sandwich generation is a very real thing. Right and it puts a lot of pressure on the ones in the middle. You know if you've got a husband and wife taking care of children and parents at the same time it's a lot of stress. What was what was what were the ladies talking about at the Bible study the other day the granny hut or the mom-in-law apartment or something. A pod or something. Yeah they're putting these in the backyard now for the parents who are moving home. It's becoming a real thing where people are adding that to their home. Yeah just so that their parents have space their own space it gives them some dignity but it also sets up some boundaries. Well I've seen that work in a beautiful way. You know we've had a number of friends who've been sandwiched kids at home while the parents moved back and to every one of them have had two things they've shared with us. Number one it was hard. It was awkward at times you know and just having privacy and and some of the interferences but long term every one of them said it was beautiful and they would do it all again

and they miss their parents now that they're not living there. Right and the children benefit from the grandparents the grandparents benefit from the children. It's just not been culturally done here. It is all over the world but yeah not so much here. Most other cultures it's normal to live generationally together. I think it's important to set up financial expectations even to the point of having a contract of what's their part what's your part. One couple we talked to basically looked at their home as an apartment that their parents were renting and their parents found it to be less expensive than assisted living or any kind of senior care and so they were happy to pay it. They essentially contributed most of their Social Security income to that contract which allowed the the owner of the home the person in the middle to manage that money on their behalf. It worked out really well. I think one thing that's very important is if you have parents living with you and they're not in good health is that you seek help, that you let your church, your small group, or Bible study, neighbors know what the situation is so that they can help you. Because it's easy to get burned out when you're taking care of sick people and trying to work and take care of children. Yeah, you have to have your own space and privacy and the ability to get away and to rejuvenate. And it's an opportunity for those of us who don't live in that situation to help others, to be more aware and compassionate, take a meal, offer to help, babysit, drive the parents, whatever. You know, if you teach your children to understand the principle of scarcity, that you have to be a good manager of whatever you have

and be very faithful with that, and to really honor God by being givers, as you said was our first priority, then you teach them to allocate and you teach them to work, you're gonna be better off than most of the people who are trying to figure this out. Just those three basic principles have paid such great dividends in our lives and our children's lives. Right. Yeah, I think one thing, looking back, that I did, I was really too generous in some areas. One was, at Christmas, we'd give the kids money to spend on gifts. Well, looking back, had they known that they were gonna buy their own gifts, they would've saved up for that. Or they might not have gone out and bought just whatever they wanted. They would've been more thoughtful, you know, and used their money differently than ours. Well, I think we started to realize how much materialism we had sort of supported, and we wanted to pull back on that. And over the years, I've seen us become much more, not necessarily frugal, but much more careful and intentional about what we do at Christmas. Even minimizing how much money has gone just into plastic toys and sort of the disposable

gift kind of thinking that we used to do. Right. Right. Right.