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The Money Honey: Teaching Kids About Cash

The Money Honey: Teaching Kids About Cash

By Rita Warren ~

One of the sad things about life is that it seems children are not taught about finances or investing in school unless you major in business or economics in college, and this goes for both men and women.  As a result, as adults, we are playing catch-up to try to make our money work for us: we read articles, we go to conferences or investment seminars, we watch cable business channels, whatever it takes to provide ourselves with the needed information to make sound decisions about how to put our money to its best use.

Wouldn’t it have been better to learn these things while we were learning the alphabet or simple mathematical skills, so that they were built into our skill sets as children?  (I think this goes for other adult needs as well, such as parenting and marriage, but that’s another topic for another time.)  So given the fact that we didn’t learn these skills as children, what are we to do now for ourselves and – if we are parents – for our own children?

For ourselves, we can start with baby steps.  As I’ve indicated throughout my writings for, you start small.  You learn one step at a time, by coming to understand the terminology of investing, by opening a brokerage account at a user friendly firm where you can ask questions without being made to feel like you’re a worm, by making mistakes and learning from those mistakes (and hopefully not making too many of them), and by savoring the delicious taste of victories won when you buy a stock that goes up, knowing when to sell it and take your profit, dissecting what went right so that you’ll know how to do it again and again.

Then, if you have small children, there’s the simple matter of replicating your knowledge with baby steps with your babies.  You start with small children – say, around the age of five or six – by beginning to offer them an allowance, which is, basically, their “salary.”  Now, what do you want to teach them by means of that “salary”?  How to save?  How to invest?  How to give money away?  Then start small.  Use whatever means you find around you.  Yes, they are young.  But they are not stupid.  And they will thoroughly enjoy the opportunity to talk to you and with you about the basics of money matters.  In the culture in which we live, they understand all too quickly how significant of a role money plays.  So why not mold that understanding to a positive rather than a negative while they are malleable?

Teach them on an elementary level and elevate that teaching every year.  By the time they are in high school, they should be able to manage the larger allowance with skill and responsibility.  They should have a brokerage account of their own, and can you imagine the pride they will feel sharing with their friends that they own a piece of McDonalds or Disney when they’re eating a Big Mac after school?  Better yet, teach them to contribute to worthy causes when they’re young so that they develop a sense of community with the world and the needs of people globally.

Don’t you wish someone had taken the time to do this with you?