Smart Money Smart Kids by Dave Ramsey & Rachel Cruze Summary

Smart Money Smart Kids by Dave Ramsey and Rachel Cruze is a guide for parents to teach children financial responsibility through budgeting, saving, and avoiding debt. It blends personal anecdotes with actionable strategies, emphasizing core principles like work ethic, delayed gratification, and generosity. The book covers age-appropriate lessons, from toddler chores to teen budgeting, aiming to empower kids for lifelong financial success.

This book is ideal for parents, guardians, or educators seeking practical methods to instill money management skills in children. It’s especially valuable for families prioritizing debt-free living, cash-based spending, and fostering financial independence. The advice applies to all ages, making it relevant for parents of toddlers through teenagers.

Yes, the book offers actionable, no-nonsense strategies grounded in Dave Ramsey’s financial philosophy. Parents praise its focus on real-world applications, such as using commissions (not allowances) and teaching charitable giving. However, critics note its strict stance on debt avoidance may feel rigid for families open to strategic credit use.

Key concepts include:

• Work-Money Connection: Tie earnings to chores via commissions.
• Cash-Based Living: Avoid debt by saving for purchases.
• Generosity: Teach giving as a non-negotiable habit.
• Contentment: Combat materialism by valuing experiences over possessions.
• College Funding: Prioritize cash savings over student loans.

The authors advocate replacing allowances with commissions, where children earn money by completing age-appropriate chores (e.g., toddlers tidy toys, teens manage larger tasks). This system reinforces that money is earned, not entitled, and helps kids associate effort with reward.

Ramsey and Cruze strongly oppose traditional allowances, arguing they disconnect money from effort. Instead, they recommend commissions—paying kids for specific chores—to teach work ethic and financial accountability. This approach starts as early as age three with simple tasks.

The book urges families to avoid student loans and save proactively through 529 plans, part-time jobs, or scholarships. It emphasizes cash-flowing college costs to prevent debt, even if it means attending affordable schools or delaying enrollment.

Some readers find the authors’ anti-debt stance extreme, particularly regarding mortgages or student loans. Others feel the book oversimplifies modern financial challenges, such as rising education costs, and lacks flexibility for low-income families.

The book advises teaching gratitude and contentment through practices like donation jars, family volunteer work, and open conversations about advertising tactics. It also encourages setting an example by prioritizing savings and experiences over impulse buys.

Lessons are tailored for all stages:

• Toddlers: Introduce money through play and simple chores.
• Elementary Kids: Teach saving via clear jars (spend, save, give).
• Teens: Focus on budgeting, part-time jobs, and long-term goals.

Generosity is framed as a lifelong habit, not an afterthought. Families are encouraged to allocate a portion of earnings to charity, involve kids in choosing causes, and discuss the impact of their contributions. This builds empathy and financial balance.

Unlike anecdotal guides, this book merges Dave Ramsey’s debt-free philosophy with Rachel Cruze’s generational perspective. It’s more tactical than The Total Money Makeover, with step-by-step strategies for raising kids who avoid debt and value hard work.