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iQuestions Faculty, Ron Blue 
 
 
Question: 
 
What money management skills should I be developing in my children? 
 
Answer: 
 
RON BLUE: I think it’s important to realize that when you talk about 
developing skills, you’re talking about something that can be learned. 
You know, I could have the skill of being a good carpenter; I could 
have the skill of preparing financial plans; I could have many types of 
skills that are learned almost by repetition and by rote. These are 
things that I become good at, and I can do over and over again. 
 
So, when we are talking about our children, we’re saying, “Okay, what 
are the skills that we want them to learn?” I think there are at least 
four skills that I would like for my children to have learned—and I 
think they did—and one of those skills is, “How to develop a spending 
plan,” or what’s called a budget. 
 
In other words, that’s a skill. That doesn’t take even financial 
expertise, necessarily. “How can I develop a spending plan? What do I 
need to do to develop a spending plan?”  
 
Secondly, as a skill is, “How do I buy wisely?” 
 
I think you [Judy] really did a job of teaching our children the skill of 
how to buy wisely. My wife is a better money manager than I am. She 
has the real skill of buying very wisely. I don’t take the time to buy 
wisely. 
 
 
 
JUDY BLUE: You know, I think that in the process of using the 
envelope system, that it was very effective to help them understand 
what was a wise choice relative to what the need was, and how much 
money they had to spend according to that occasion.  
 
RON: I think another one is “how to make financial decisions.” And I 
could even broaden that and say, “How do you make decisions?” 
Very, very few people, I’ve found, have the skill of decision-making. 
They don’t have a process of skill of decision-making. We taught our 
children a process of making decisions. And Michael, of course, is a 
classic example of that, and became so skilled at that that he taught 
his classmates in college how to make decisions.  
 
The bottom-line of the skill of decision-making is that every decision is 
a choice among alternatives, and the choice among alternatives is 
evaluated by the objectives that you have.  
 
So, our son was a very good tennis player. He went on to play tennis 
in college—he was an all-American tennis player—but when he was 
graduating from high school, he had probably a hundred college offers. 
How do you sort all of that out? Because, coaches were important, 
playing partners were important, academics was important. There was 
a whole bunch of things that were important.  
 
And what we did with him is we taught him that you listed your 
objectives, your criteria, your priorities—whatever you want to call 
them, whatever is important to you—and then you begin looking at all 
of your alternatives, and all of your alternatives are important only as 
they relate to your criteria, your objectives, or your priorities.  
 
And he developed a matrix, and made the decision to go to the 
University of Texas, and he played tennis there—and we still have that 
matrix, and I have it in my files, and I use it to teach a lot of children. 
 
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JUDY: I think that’s more thoroughly explained in one of the books. 
 
RON: I think it is. I think in Your Kids Can Master Their Money we 
explained that process—and I think in Master Your Money it’s 
explained also. That’s a life skill that’s a really important skill. 
 
JUDY: And I really do feel so grateful for it, and it’s one of the tools 
that I share with friends all the time—because, so often when we’re 
making decisions, we get stuck in a binary trap, and we compare 
alternatives to each other, rather than comparing the alternative to 
what it is that we want to ultimately have happen.  
 
So, “What are your objectives?” “What do you want to accomplish with 
making this decision?” and then, “What are your alternatives?”—and to 
expand that, and walk through a process. 
 
RON: You know, I’ve been teaching financial advisors over the last 
couple of years—I’ve taught several hundred—and I’ve taught them 
decision-making. And you would think that financial advisors would 
know how to make decisions, but this is revolutionary to them.  
 
And it’s basically figuring out what are the criteria, and then measuring 
the criteria, and then measuring my alternatives against the criteria. 
And so, I would just encourage you to develop the process and teach 
your children the process of making decisions. 
 
We’ve already talked in other vignettes here about how to set financial 
goals, but I think that’s a skill. You know, that’s not something that 
takes anything other than some repetitive practice on setting some 
financial goals. And we did that. 
 
And then, there are some things that we’d really like them to learn. 
You know, God owns it all. He can take whatever He wants, whenever 
He wants it. It all belongs to Him.  
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I think the idea that there’s a tradeoff between time and effort, and 
money and reward—remember when the kids would run out of their 
envelopes, what would they have to do? 
 
JUDY: If they wanted more money, they always could earn it. They 
could do extra jobs around the house, they could babysit. There’s 
always a way to earn money. We always made sure there was a 
vehicle if they wanted to earn more money, if it was a legitimate one. 
 
RON: Right. Or they could go to the neighbors, and offer to do a job or 
something.  
 
I think the idea that there’s no such thing as an independent financial 
decision—so, when they put money in, they would put ten percent of it 
in their tithe envelope, and they could put ten percent in their savings 
envelope, and then they could put it in any of their other envelopes. 
But the fact is, when they put it in an envelope, it wasn’t available to 
be put in any other envelope.  
 
And that’s something a lot of adults don’t understand, that once you 
spend it, it’s gone forever, and you only get that chance once. 
 
And then lastly, I think, is the whole idea of delayed gratification. 
 
JUDY: Oh, that’s un-American. [laughs] 
 
RON: [laughs] 
 
JUDY: People just don’t understand, because there’s all the advertising 
that tells us that you can have it now, whatever it is, and pay later, 
and that you do deserve a break today. So, I think that is a real 
challenge, to teach your kids delayed gratification—and all the more 
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reason for the envelope system, and for teaching them how to make 
good decisions. 
 
RON: And that also is a skill. Delayed gratification is something I can 
learn, and it becomes a matter of the will. And delayed gratification is 
a gift to give to your kids that is lifetime. 
 
JUDY: And it’s giving up today’s desire for future benefit. 
 
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