Nancy Phillips

Are you thinking to yourself “I know I should be teaching my children about how to manage their money, but where do I start?” If so, you’re not alone.

The Powerful “Give*Invest*Save*Spend Method” for Managing Money and Building Wealth


This method is a wonderful place to start, especially with children. Why? Because it’s simple and effective.

You may have heard the old saying “Keep It Simple Sam.” Well, it’s true, the easier something is, the more likely it will happen, especially if it has to do with starting a new habit. The “GISS Method”  helps frame the financial decision-making process thus simplifying it.

Financial experts including Robert Kiyosaki, T. Harv Eker and David Bach discuss the immense rewards that result from dividing income into categories, allowing people to effectively plan for life’s needs and wants. As Mr. Kioysaki, author of the Rich Dad, Poor Dad series state’s, “rich people give, invest, save and spend. The middle class and poor people spend and then give and save if there’s anything left.”

Here’s how you can help your children develop good “money habits.” Help them divide all income into these categories:

Give (10%)

This is an ancient concept often referred to as “tithing” which means “a tenth.” Giving is a very valuable concept for children to learn early on because as they begin to give to various causes, they become aware of their ability to help others and make a difference in the world. Children need to learn how to be thoughtful and kind, especially in this fast-paced world. Contributing to worthy causes increases their self-esteem and feeling of “community.” Acts of kindness have been proven to affect people in a very positive way which is especially good for children because of the feeling of empowerment and joy it gives them.

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Invest (15%)

Investing is critical for people to ensure they will have a secure income and good lifestyle as they get older. Many people save but end up spending their savings on material items such as cars, boats etc. and not on assets that will create cash flow such as rental properties, businesses etc. Investing is an abstract concept for really young children but can be learned about gradually. Initially, this segment can be explained as the money they grow and use when they are older.  

Save (25%)

It is critical that children and adults learn to set and achieve goals and that goes for the financial part of their lives as well. As a child works toward their goal, whether it’s saving for a bike or a toy of some kind, they learn the steps needed to achieve their goals. Sometimes they will redirect and change course if something isn’t working before continuing on. When they do achieve the goal, the self-esteem they feel is very powerful. It shows them what they are capable of and makes them feel more confident which allows them to set bigger goals. Self-discipline and decision making are fundamental lessons in personal development and success. Parents need to give their children the opportunity to set and achieve small goals so they are inspired and feel confident to pursue their bigger dreams. As children get older, this category will eventually be divided up for such items as tuition, cars and eventually their kids, children, money, savings, piggy bank, family, savings, financial servicesresidence.

Overindulgence is a major issue in our society as we know.  Saving allows for delayed gratification which is a very important part of emotional development. Studies show that giving a child everything they want as they grow up often leads to them feeling very unsatisfied and unfulfilled as adults. Dr. Bredehoft at Concordia University has done a great deal of research on this topic. His conclusion is simple: if you want your children to be self-centered greedy adults, overindulge them. If you want them to grow up to be caring, thoughtful and happy adults, don’t overindulge them.

Spend (50%)

This is the money for expenses if you’re an adult and basic spending money for treats and so on for children. Children are perfectly happy to watch you spend your money on the things they ask for; it’s no fault of theirs. But once a child uses their own money for purchases they begin to consider the cost and value of things. It’s much better for a young child to have a chance to handle money and make mistakes with a few dollars than it is to send them off to college and expect them to learn on their own. Mistakes are not bad things; they are lessons that need to be learned. Buyer’s remorse over a cheap broken toy teaches a strong lesson about quality even to a pre-schooler.

The Bottom Line

The weekly experience of dividing your money into “Give, Invest, Save and Spend” categories is powerful for many reasons. The process is repetitive which is important for learning and developing new habits. It is full of memory making actions such as counting and sorting coins. The method also incorporates thinking and decision makingskills when the child sets their short and long-term goals. These experiences all work together to make a memorable learning experience and create the foundation for good financial habits.

As a parent, you will be amazed at the conversations you have with your children as they go through this process. I can tell you both from personal experience and from the many stories I hear from parents, the experiences are often heartwarming and sometimes quite profound. They discuss their dreams and what they’re saving for, how they want to help make the world a better place and what they want to invest in. They feel proud to be managing their own money and to have been given the responsibility by you.

The Zela Wela Kids Build a Bank book teaches children about the “GISS System” and how to build their own “GISS”bank at home which they can then use. If you like, go ahead and send me a picture of your child’s bank so we can all see their great work!

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