The Lemonade Stand: Principles for Teaching Your Children About Money

May 15, 2013

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Last week, my two daughters – 10 and 7 years old – gave me a 15-page PowerPoint presentation about how they want to upgrade their room, including a budget.

Part of their plan was to set up a lemonade stand to raise some of the money, so that we did. They named themselves the “Sweet and Sour Sisters”.


To no one’s surprise, they sold out in an hour.

That’s life, isn’t it? One day you’re selling lemonade to re-decorate your room, the next you’re working full-time to feed a family. The biblical principles of good stewardship always apply, but the details of your budget and plans will evolve with your life.

It’s important to start young in training children to steward their money well. Here are some principles from my book Money: God or Gift, to help parents teach their kids about stewardship.

Teach your kids about Jesus and their need for his grace.

Generosity stems from Jesus. We may be excellent money managers, able to instruct our children in the way of financial planning, but if neither our children nor we understand the gospel, then all the financial knowledge in the world amounts to nothing.

Invite your kids into the conversation.

Too often we parents go about our day doing chores, paying bills, running errands, but forgetting to invite our kids to participate and learn about things like responsibility, work ethic, joy, and decision-making. Children can handle more than we give them credit for, and the sooner you begin developing them financially, the sooner they’ll learn.

Teach your kids to divide their money (from birthdays, holidays, and allowance) into three categories: give, save, and spend.

I’ll never forget when my son opened a fifth birthday card from his grandparents. There was some money in it, and he blurted out, “Yes, now I can pay my bills!” He didn’t have many bills as a five-year-old, but I loved the fact that he was beginning to think through stewardship.

Don’t stifle innovation; allow failure.

I know it’s a lot of work to setup the lemonade stand, but what a great opportunity to teach your kids about work, business principles, and managing finances. As your kids get ideas, take the time to encourage them and invest in them so that these mini-ventures can be used as teaching opportunities—whether or not they’re financially profitable.

Engage your kids and teach them discernment.

Most parents expect their kids to learn through osmosis rather than intentional development. And the truth is, without any parental discernment to guide them, kids will absorb their life lessons, but through marketing, friends, and TV—none of which tend to rely on the principles of Scripture for instruction. Kids need to be equipped to recognize the difference between truth and lies.

Model generosity.

Practice what you preach. Don’t give to impress your children, but don’t hide it from them either. (When you miss the mark, confess your sin to your family and let your kids see that Dad and Mom need a Savior, too.) Since generosity flows from grace, we can use it as a tool to teach about Jesus.

I can tell you from personal experience – as I snapped that photo of their lemonade stand last week – it’s worth it. Watching them put a plan together for something they want – and follow through with it – was very rewarding for me and valuable for them. Not to mention, they were incredibly cute, we got to meet some neighbors, and other parents and young entrepreneurs seemed to come out of the woodwork to cheer them on.


Click here to learn more about Money: God or Gift, or buy a copy for only $2.99 on Amazon.