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Let Your Kids Handle Their Money. Literally.

| January 30, 2018
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When our sons were born, we knew we wanted them to develop a business acumen and strong work ethic at early ages.  When they were 7 and 9 we bought a golf driving range for Jacob and Zachary to run.  As a financial advisor, I am periodically asked for advice on how to raise kids to be financially responsible.  I answer as an entrepreneur and a mother with what has been successful in our own family life.

Most important, allow your kids the opportunity to work.  To earn money!  How could we possibly expect anyone to respect something they did not earn as much as the same thing they worked hard for?  Buying the range involved a significant amount of money for us.  Our biggest risk was that Jacob and Zac would lose enthusiasm and motivation for working.  We had them create “reality boards”.  In fact, we all did!  Our reality boards were pictures of goals that each of us had.  Jacob’s first goal was a Nintendo DS, Zac’s a dirt bike.  They could easily calculate the cost of those items and how many hours they’d have to work to achieve their goal.  They kept their “eye on the prize”. 

We made sure the boys handled all their own money.  Literally.  When I was growing up, money was cash.  Now most transactions are made electronically which is a different mental registry.  It’s no wonder so many young adults get in trouble financially; spending money today is as easy as a swipe of a card.  Conversely, when the money you have is the cash in your wallet, you develop a mental discipline to only spend the money you have.  Start your kids out this way:  they can spend (all or part of) the money they earn as cash that they handle.

We had our sons endorse the backs of all their paychecks.  They maintained their own savings account ledgers.  They had to walk their paychecks up to the bank teller to deposit their money.  They wrote out and signed withdrawal slips to receive their cash to spend.  Being consistent with these practices, their financial disciplines evolved.  As they continued to work for and handle their own money, Jacob and Zac eventually became uncomfortable seeing their savings disappear and savings became a goal!  Without a doubt, our 80/20 rule was a great parallel model of how savings can build.  From their first pay checks, they had to contribute 80% to Roth IRA’s and 20% was deposited into their savings accounts for them to manage or spend as they wish.  The luster of spending began to dull and accumulation became more important.  Within their own savings, they spent less on consumables and set larger goals for their futures.

How do you raise financially responsible kids?  My advice?  #1:  allow them to work for their money.  #2:   let your kids handle their money.  Literally.

(Author’s note:  Due to industry regulations, I am prohibited from responding to any online comments. I welcome you to contact me via e-mail:

LouAnn Schulfer is co-owner of Schulfer & Associates, LLC Financial Professionals and can be reached at (715) 343-9600 or

Securities and advisory services offered through LPL Financial, a Registered Investment Advisor.  Member FINRA/SIPC. 

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