Dave Ramsey changed my life. Unfortunately, more than half of my life had passed before I “met” him on Wood Radio 1300 a few years ago. But, better late than never – hopefully I’ve still got a some years to put some of the lessons I’ve learned from him into practice.
And, even more importantly, I’ve got the chance to make sure my kids don’t make the same money mistakes I did. That’s why I’m so thankful for Smart Money Smart Kids, the latest book by Dave Ramsey, co-authored with his daughter Rachel Cruze. It’s a book for teaching parents how to train their children to be smart with money from their earliest years, but which can also teach people like me in my mid-years.
I used to work in the headquarters of a large financial services company before I was converted and called to the ministry. It was during the Thatcher/Reagan boom years in the mid-to-late eighties when money, mortgages, loans, investments and pensions were plentiful.
No one thought these years would ever end. We thought incomes, house values, pensions, and investments would just keep rising and rising, inducing multitudes to keep on living just beyond their means. “Next year’s raise will cover it….I’ll start my pension when I get that bonus….I’ll remortgage my house to pay for any emergency…My home is my investment…and so on.”
Most people weren’t tens of thousands of pounds or dollars in debt, but just a few thousand on a credit card here, a few thousand on a car loan there, etc. Saving for vacations, special purchases, and things like that were usually done after the event, via credit cards. Saving for pensions, kids education, etc. just seemed way too far away. And budgeting was just so boring.
As I say, most of us weren’t totally irresponsible, just maybe 5-10% irresponsible – spending just a bit beyond what we earned. Not a big problem – until it happens 5-10 years in a row, or when the stock-market crashes, or the housing bubble bursts, or kid’s college looms, or retirement approaches….or when they all come together in a perfect storm!
Even when we survived the downturns and recessions by tightening our belts for a few years, the previous bad habits were only hibernating and soon re-appeared when the “good times” returned.
Sound like your story? I think it’s the story of the vast majority of people, including Christians. And that’s why Dave Ramsey’s hard-hitting common-sense analysis and practical baby-step-by-baby-step solutions have struck such a chord with so many. I had never heard of him until just a few years ago when I stumbled upon his show on our local Grand Rapids radio station one evening.
Ramsey’s approach is really very simple and obvious, and yet for all the thousands of hours we spend in school and church, the vast majority of us are not taught the basics of how to handle money responsibly and biblically. In this dangerous vacuum, we suck up the irresponsible and unbiblical messages and habits of our culture.
I’ve still got a lot to learn (and unlearn) in this area, and in some areas it’s almost too late for me to repair the damage – I already have two sons of college age. However, I do want my kids to learn better than I did. We are now regular listeners to Ramsey’s radio program (if only to make us feel a lot better about our financial stewardship compared to most people!), we read his books, and we talk a lot about the principles and practices he teaches. But, until now, we’ve lacked a systematic way of teaching this to our younger kids (I’ve got three aged 12 and under). That’s where Smart Money, Smart Kids comes in and excels.
It’s written in a conversational style with Dave and Rachel alternating throughout. Dave speaks of how he taught Rachel and his other kids, then Rachel talks about how she and her siblings learned through the hard times and the good times. The to-and-fro style works surprisingly well, giving a dynamism and energy to the book. The teaching covers all the main areas: working, spending, saving, giving, budgeting, debt, college, etc., and is also tailored to two different age-groups throughout (6 to 13, and 14 to college age).
Tomorrow I’ll list the major lessons I took away from the book. In the meantime, you can buy it here – highly recommended. If you want to teach yourself first before you teach your kids, I’d recommend Ramsey’s Total Money Makeover.