The Jewish community has earned a reputation for its remarkable prowess in money management and wealth creation. A testament to this is the presence of five Jewish individuals among the top 10 wealthiest Americans, including notable figures like Mark Zuckerberg of Facebook, Larry Ellison of Oracle, Larry Page of Google, Sergey Brin of Fellow, and Michael Bloomberg.
Remarkably, while Jews constitute just 3% of the American population, they account for a staggering 67% of Forbes 400 richest Americans.
In the quest for financial acumen, I have delved into numerous books expounding on the art of prudent money management and debt resolution. However, it is the straightforward yet immensely practical approach employed by the Jewish community that has seized my attention and kindled my imagination. This approach centers on the financial education provided to Jewish children from an early age.
Within Jewish culture, the process of teaching children about money commences almost as soon as they are able to articulate words. This practice is deeply rooted in an understanding of the biblical adage, “Teach a child the way of the Lord, and when they will grow, they will not depart from it.” Consequently, the transmission of financial knowledge to the younger generation is an integral facet of Jewish heritage. Children, characterized by their receptive nature and eagerness to learn, serve as ideal recipients of these teachings.
To cultivate wise money management skills in their offspring, Jewish parents employ a practical tool: five labeled jars, akin to contemporary piggybanks or home banks. Each jar is designated for a specific financial purpose and features an accessible top for ease of use. These jars bear the labels TITHE, GIVING & OFFERING, SAVING, INVESTING, and SPENDING. Whenever a child receives an allotment of 10 Shekels, the currency of Israel, they are provided with the following instructions for allocation:
–One Shekel shall be apportioned to the TITHE jar (equivalent to10% of the allotment). This practice, deeply rooted in Jewish philosophy,instills in the child the virtue of generosity by prioritizing contributions tocharitable causes.
–Another Shekel shall be earmarked for the GIVING & OFFERING jar(also constituting 10% of the allotment). This principle reinforces the notionthat one should prioritize the needs of others before tending to their own,emphasizing a sense of social responsibility.
–One Shekel shall be reserved for the SAVINGS jar (equivalent to 10% ofthe allotment). This allocation is intended to serve as a financial cushion forunforeseen emergencies, teaching the child the importance of fiscal planning toaddress unexpected financial challenges that may require immediate attention.
–Two Shekels shall be dedicated to the INVESTING jar (20% of theallotment). This allocation encourages the child to develop an earlyunderstanding of investment and the potential for wealth accumulation overtime.
–The remaining five Shekels shall be designated for the SPENDING jar (50%of the allotment). This allocation allows the child to manage discretionaryexpenses for their personal use.
The rules governing access to these funds vary: the GIVING jar may only be opened on Sundays, the TITHE jar is unsealed at month-end, the SAVINGS jar is reserved for special occasions or emergencies, and the INVESTING jar is unlocked when it reaches full capacity. Crucially, the child exercises complete autonomy in determining when and where to invest the accrued funds, with parents refraining from intervention, even in the face of potential missteps. The Jewish tradition holds that failure serves as an invaluable teacher, fostering creativity in decision-making and nurturing a sense of responsibility for one’s choices.
Research attests to the formidable challenges posed by financial management in our lives. Successfully navigating this terrain can significantly ease the management of other life aspects.
Consequently, Jewish children, armed with a strong sense of responsibility and financial acumen, often experience heightened satisfaction and success compared to their peers. In stark contrast to the credit card debt woes experienced by many Americans and Europeans, the dispersed Jewish community thrives in both personal finances and business endeavors.
For those of us who did not have the privilege of undergoing these transformative lessons in our early years, there are valuable lessons to be gleaned. First and foremost, making a concerted effort to impart financial wisdom to our own children is among the most worthwhile investments we can make in their future. Additionally, adopting a receptive attitude and embracing these principles, regardless of age, can yield significant benefits. While it may seem unconventional, embarking on this financial journey, perhaps alongside your children, can prove rewarding.
In summary, the financial teachings passed down within the Jewish community serve as a compelling model for instilling responsible and informed money management from an early age. By embracing these principles and passing them on to future generations, individuals and families can empower themselves to achieve financial stability and success.
