Thursday, March 27, 2014

Raising Money Smart Kids- It Starts With The Parents

Raising Money Smart Kids

I truly believe more is caught than taught . . . that what your kids

see you do is a lot more powerful than what they hear you say.

Words can be strong, but actions are stronger. The strongest impact on children, though, is when they hear and see a consistent message from

their parents. When the parents’ words and actions come together, it

forms a powerful statement about that family’s value system.

~ Rachel Cruze

Excerpt from Smart Money Smart Kids

Because I know that more is caught than taught, I knew that helping our kids learn to win with money had to start with us learning how to win with it first. Our world, and my own personal concept of money, flipped upside down in 2009 when we were first introduced to Dave Ramsey’s Financial Peace University.

We started working the baby steps and following his plan. We made an agreement amongst ourselves that unless we both agreed to do something different, we would follow Dave’s recommendations to a “T”. The only exceptions would be where we both agreed that it made sense for our family to break from the agreed upon course. Then and there, all of our money fights disagreements disappeared.

We already had baby step 1 finished (to save $1,000), so we jumped right in to baby step 2—Dumping debt with a vengeance.

To make a long story short, we had nearly $25,000 in student loans, medical debt and an outstanding pledge we had made to our church’s building fund that we felt we needed to pay as if it were a debt. A large chunk of the income from my 20 hour per week Children’s Ministry Director position went toward these debts. I was juggling life with young kids and working to pay back things we had already experienced (namely college and an unexpected ambulance ride when my husband hit his head on the slide at a water park). We were up to our eyeballs in monthly payments, still trying to squeak by on a combination of Rob’s associate pastor’s salary and my part-time income. 

During this time we had four preschoolers at home. Yes—four. We became foster parents to my much younger half-siblings who happen to be born in the same years as my own children. They were 3, 4, 5 & 5 years-old. It might go without saying that I’m pretty sure 2009 was the year my hair started to turn gray.

Rob also started his transition in to the Lead Pastor role that year so he was now preaching most Sundays. 

Clearly, with all of this stress in our lives, this was an obvious time to cut out any and all non-essential spending, right?

Really, there’s never an ideal time to do it, but I knew it needed to be done. The sooner we could get out of debt, the sooner we could experience financial freedom. The stress we were experiencing at home and at work was only magnified by the fact that we had these debts hanging over our heads.

For the first time in our lives we realized that we could take control of our own financial future. With some hard work, planning and sheer determination, we knew we could find the light at the end of the tunnel. The added stress of tackling our debt was actually freeing because we knew that every time we said “no” to purchasing something, we knew we were that much closer to being debt free. Once we were debt free we could actually live off of Rob’s income and I might finally have the opportunity to stay at home and enjoy my little kids without trying to figure out to squeeze 20 hours worth of work into each week as well.

Of course it might be worth reminding you that I had 4 preschool aged kids at home, so lets be honest, I actually found going to work to be a reprieve at that particular stage in life!

But I digress.

We took our small group through Financial Peace and decided to wage an all out war on our debt. We were able to tackle the ambulance bill right away then took that $40 per month and put it toward our next smallest debt. When we paid that off we put both monthly payments into the next debt, and so forth and so on.

We also started selling stuff. In fact, we sold so much stuff the kids thought they’d be next (<--It’s a Dave Ramsey joke)! If we didn’t need it, use it daily or love it dearly, it was on the chopping block. We wanted so badly to experience this financial freedom Dave had spoken so much about.

Additionally, we cut our expenses to the bare minimum. We started living on a rice and beans budget. This was actually the start of my vegetarian ways because we stopped buying meat and I realized that I didn’t miss it one bit!. We didn’t purchase a thing if it wasn’t in the budget. We started paying cash for everything and analyzing every purchase.

Finally, at the end of every month we took whatever money we had left over from our foster care payments and threw that at our loans well. Of course, the needs of the kids always came first and we made sure they were well cared for, but we found that there was always some left over. 

We originally calculated that it would take us 4 years to get out of debt. However, the closer we got to getting out of debt, the more desperately we wanted to reach our goal. The closer we got to our goal the more we scrimped and saved and worked and paid. I must admit—we almost became obsessive about it. We were absolutely determined!

In the end, it took us 14 months to pay off $25,000 worth of debt. That was one of the most glorious days of our lives! We were finally FREE and we knew that we wanted our kids grow up never getting into the bondage of debt in the first place. 

Our preschool aged kids were watching us throughout this process. They were also watching a whole lot of Dave Ramsey. Every time we put the FPU videos on in our living room they would run downstairs, plop themselves on the floor in front of the t.v. and listen to Dave speak as if they actually knew what he was talking about. The way he captivated them would give you reason to believe that they were honestly actually taking some of this information in. It became obvious that they really were when they loudly and awkwardly questioned us when using our “credit card” (which was actually a debit card). “Dave Ramsey says credit cards are bad, mom!” they would proudly and piously announce at the tender ages of four and six.

This was the beginning of a new chapter of our lives. No longer did we believe that the only good things we would ever receive would be due solely to someone else’s generosity. Dave Ramsey’s principles gave us the tools and skills and we needed to take control of our own financial future. We still fully and completely trusted God for our finances and our future, but we slowly began to realize that choosing a life of full-time ministry didn’t necessarily mean taking a vow of eternal poverty.

To effect lasting and permanent change we knew that we couldn’t do this alone—we needed to bring our kids along on this journey with us. Therefore, we set out with intentionality to raise money-smart kids in a debt-filled world. I am excited to give you more details of exactly how we did that in the weeks to come!

You are reading a series about Raising Money-Smart Kids that I am writing as part of a

Smart Money Smart Kids book launch team. We are often asked what we do to teach our kids about

money and good stewardship. In this series I will share our story along with some of our best loved tricks and tips for helping kids win with money in a debt-filled world. Click here to read more posts in this series.


Darlene Collazo said...

So awesome to hear this testimony of God's faithfulness!

Robyn said...

Thank you Darlene. Faithful, He is!